Two Sigma

High water mark- The highest peak in value that an investment fund/account has
reached. This term is often used in the context of fund manager compensation,
which is performance based
Hurdle rate- In the hedge fund world, hurdle rate refers to the rate of return that
the fund manager must beat before collecting incentive fees
Incentive fees- A fee paid to a fund manager by investors. Incentive fees are
typically dependent upon the manager's performance over a given period and are
usually taken in relation to a benchmark index. For instance, a fund manager may
receive an incentive fee if his or her fund outperforms the S&P 500 Index over a
calendar year, and may increase as the level of outperformance grows.
Management fees- A charge levied by an investment manager for managing an
investment fund. The management fee is intended to compensate the managers for
their time and expertise. It can also include other items such as investor relations
expenses and the administration costs of the fund
LP Limited partnership, MLP-Master Limited partnership, LLC-Limited Liability
Corp
Allocations- for investor returns based of using an allocation system
NAV- Net Asset Value
Accounts:
1,000- Assets
2,000- Liabilities, payables
3,000- Capital accounts
4,000- Revenue
5,000- Expenses
JE/Accruals- expenses booked monthly or daily depending on the fund
Eg dr-admin expense
Cr-admin payable
Payment of an accrual- dr- admin payable

Cr- cash
Lingo- HF, Hedge Funds, PE- Private Equity, FOF-Fund of Fund, GL-General Ledger,
TB- Trial Balance, Holdings-Portfolio, Cash Rec, Cash reconciliation, withdrawalcapital taken out of the fund by investor usually done EOD (End of Day),
Contribution- money coming usually done BOD (Beginning of Day)
Accounting system-Geneva, investier-allocation system