DARWIN providers’ only compensation source is quarterly investor success-fees. Quarters are investor and DARWIN individual, investors start them on their first purchase of any DARWIN. Throughout the quarter, Darwinex retains 20% of investor profits and holds them on escrow until quarter-end, when they’re paid out.
This way, in a quarter where an investor invests, sells his holding at an interim profit, re-purchases the DARWIN and suffers an overall loss for that quarter in that DARWIN, any escrowed success are “clawed back” from the escrow account by Darwinex and no success fee accrues, even if one was temporarily held on escrow for the first investment in the quarter.
Further, the high water-mark principle applies. 20% performance fees only apply to the extent that quarterly profits exceed above the DARWIN’s highest peak since first listing.