Hedge funds have been described, rather cuttingly, as a fee structure in search of an investment strategy. Their standard “2 and 20” annual charges (2 per cent of assets and 20 per cent of returns) are certainly high compared with onshore investment funds. The rationale seems to be, we are worth it.

Some of them proved not to be worth it. The survivors, according to anecdotal reports, are open to negotiation on fees. But if hedge fund managers have to give ground on offshore funds, they show no signs of following suit with the onshore products they are launching. These are coming out with breathtakingly high fees – try 2.5 per cent on assets and a 15 per cent performance fee (for retail investors) for the York Event-Driven Ucits Fund, launched last week by York Capital Management and Bank of America Merrill Lynch. Institutional investors get off more lightly, paying 1.5 per cent plus a performance fee.