Carried interest or carry is a term used in the private equity world to describe the performance related fee that a general partner can earn from a successful investment. Often the limited partnership investors will agree a deal with the general partner whereby, if cash is freed up from an investment, the limited partnership investors first get the return of the money they invested, then a preferred return, and then any other profits are shared with the general partner in a fixed ratio. Often this is 80:20 limited partnership investors:general partner.
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