A) You need to build up to capacity, so you&#x27;ve got a multi-billion dollar fund already by that point that is charging low fees and presumably doing very well. You just close it to new business until outflows make space.<p>B) You can win major plaudits by lowering client fees. Guess what - when investment performance inevitably goes through a bad patch the client will stay with a manager they like for a lot longer than one they don&#x27;t. That gives you time to recover performance and avoid a yo-yo effect.<p>If your manager is telling you that you need to pay high fees because they&#x27;re popular you are being ripped off.