The Economics of Hedge Funds: Alpha, Fees, Leverage, and Valuation

Hedge fund managers are compensated via management fees on the assets under management (AUM) and incentive fees indexed to the high-water mark (HWM). We study the effects of managerial skills (alpha) and compensation on dynamic leverage choices and the valuation of fees and investors' payoffs. Increasing the investment allocation to the alpha-generating strategy typically lowers the fund's risk-adjusted excess return due to frictions such as price pressure. When the manager is only paid via management fees, the manager optimally chooses time-invariant leverage to balance the size of allocation to the alpha-generating strategy against the negative impact of increasing size on the fund's alpha. When the manager is paid via both management and incentive fees, we show that (i) the high-powered incentive fees encourage excessive risk taking, while management fees have the opposite effect; (ii) conflicts of interest between the manager and investors have significant effects on dynamically changing leverage choices and the valuation of fees and investors' payoffs; (iii) the manager optimally increases leverage following strong fund performances; (iv) investors' options to liquidate the fund following sufficiently poor fund performances substantially curtail managerial risk-taking, provide strong incentives to de-leverage, and sometimes even give rise to strong precautionary motives to hoard cash (in long positions); and (v) managerial ownership concentration has incentive alignment effects.

Case report: Diagnosis and treatment of delayed epidural pyogenic abscess after brain tumor operation: a report of 5 cases and review of the literature

ObjectiveTo explore the clinical manifestations and treatment of delayed epidural pyogenic abscess after brain tumor surgery.MethodTo retrospectively analyze the medical records of 5 patients with delayed epidural pyogenic abscess after brain tumor surgery in our hospital from January 2010 to December 2020, including clinical manifestations, laboratory results, imaging findings, treatment measures, prognosis, etc. The causes of epidural abscesses were analyzed, and the treatment methods and prognosis were evaluated.ResultAmong the 5 cases, there were 4 male and 1 female patient, aged 52–75 years. Three cases were gliomas and 2 cases were meningiomas. Four cases received postoperative radiotherapy, and 1 case had open frontal sinus during operation. None of the surgical incisions were infected. The time between the tumor surgery and the discovery of an epidural abscess was 1.5 to 24 months. All 5 patients had headaches, 1 case had a fever, and 2 cases had limb dysfunction. Three cases had elevated blood inflammatory markers. MRI- DWI showed restricted diffusion. All 5 patients underwent surgery, 4 patients had bone flap removed, and 1 patient had bone flap retained. Bacterial culture was positive in 3 cases and negative in 2 cases. All 5 cases were cured, followed up for 1.5–9 years, and no epidural abscess recurred.ConclusionThe clinical manifestations and laboratory results of delayed epidural pyogenic abscess after brain tumor surgery are not specific, but MRI-DWI has specificity. Postoperative radiotherapy for brain tumors and intraoperative opening of the frontal sinus may be associated with delayed epidural pyogenic abscess. For patients with normal skin flap and no serious inflammation of the bone flap, clinicians can attempt to preserve the bone flap

Comparative proteomics of human milk casein fraction collected from women of Korean and Han ethnic groups in China

IntroductionHuman breast milk provides neonates with indispensable nutrition and function. Milk protein is one of the main constituents of breast milk. Human milk profiles can be influenced by many factors.MethodsThe present study aimed to investigate the difference in casein isolated from mature milk of healthy mothers of Korean and Han ethnic groups in China using data-independent acquisition (DIA) proteomics.ResultsA total of 535 proteins were identified and quantified in casein fraction samples from both groups. A total of 528 proteins were annotated to 52 Gene Ontology (GO) terms, the majority (94.13%) of which were distributed in the cell and cell parts of the cellular component. Kyoto Encyclopedia of Genes and Genomes (KEGG) analysis revealed that 106 proteins were involved in 23 pathways, the greatest (36.79%) in carbohydrate metabolism. There were 39 differentially expressed proteins (DEPs)–10 upregulated and 29 downregulated–between Korean and Han milk. The GO function of blood microparticles and KEGG pathway of Staphylococcus aureus infection for DEPs were the most significantly enriched (p < 0.05). Protein-protein interaction analysis revealed a network with 23 DEPs in 47 interactions, and the fibrinogen alpha chain ranked first as the hub protein.DiscussionThese data may provide useful technical guidance for the development of specific infant foods for certain populations

Mechanistic study of visible light-driven CdS or g-C₃N₄-catalyzed C–H direct trifluoromethylation of (hetero)arenes using CF₃SO₂Na as the trifluoromethyl source

The mild and sustainable methods for C–H direct trifluoromethylation of (hetero)arenes without any base or strong oxidants are in extremely high demand. Here, we report that the photo-generated electron-hole pairs of classical semiconductors (CdS or g-C3N4) under visible light excitation are effective to drive C–H trifluoromethylation of (hetero)arenes with stable and inexpensive CF3SO2Na as the trifluoromethyl (TFM) source via radical pathway. Either CdS or g-C3N4 propagated reaction can efficiently transform CF3SO2Na to [rad]CF3 radical and further afford the desired benzotrifluoride derivatives in moderate to good yields. After visible light initiated photocatalytic process, the key elements (such as F, S and C) derived from the starting TFM source of CF3SO2Na exhibited differential chemical forms as compared to those in other oxidative reactions. The photogenerated electron was trapped by chemisorbed O2 on photocatalysts to form superoxide radical anion (O2[rad]−) which will further attack [rad]CF3 radical with the generation of inorganic product F− and CO2. This resulted in a low utilization efficiency of [rad]CF3 (&lt;50%). When nitro aromatic compounds and CF3SO2Na served as the starting materials in inert atmosphere, the photoexcited electrons can be directed to reduce the nitro group to amino group rather than being trapped by O2. Meanwhile, the photogenerated holes oxidize SO2CF3− into [rad]CF3. Both the photogenerated electrons and holes were engaged in reductive and oxidative paths, respectively. The desired product, trifluoromethylated aniline, was obtained successfully via one-pot free-radical synthesis.</p

Intermittent PI3Kδ inhibition sustains anti-tumour immunity and curbs irAEs

Phosphoinositide 3-kinase δ (PI3Kδ) has a key role in lymphocytes, and inhibitors that target this PI3K have been approved for treatment of B cell malignancies1-3. Although studies in mouse models of solid tumours have demonstrated that PI3Kδ inhibitors (PI3Kδi) can induce anti-tumour immunity4,5, its effect on solid tumours in humans remains unclear. Here we assessed the effects of the PI3Kδi AMG319 in human patients with head and neck cancer in a neoadjuvant, double-blind, placebo-controlled randomized phase II trial (EudraCT no. 2014-004388-20). PI3Kδ inhibition decreased the number of tumour-infiltrating regulatory T (Treg) cells and enhanced the cytotoxic potential of tumour-infiltrating T cells. At the tested doses of AMG319, immune-related adverse events (irAEs) required treatment to be discontinued in 12 out of 21 of patients treated with AMG319, suggestive of systemic effects on Treg cells. Accordingly, in mouse models, PI3Kδi decreased the number of Treg cells systemically and caused colitis. Single-cell RNA-sequencing analysis revealed a PI3Kδi-driven loss of tissue-resident colonic ST2 Treg cells, accompanied by expansion of pathogenic T helper 17 (TH17) and type 17 CD8+ T (TC17) cells, which probably contributed to toxicity; this points towards a specific mode of action for the emergence of irAEs. A modified treatment regimen with intermittent dosing of PI3Kδi in mouse models led to a significant decrease in tumour growth without inducing pathogenic T cells in colonic tissue, indicating that alternative dosing regimens might limit toxicity