Depends on who your service providers are and what they charge. Some will do it for less. Are you looking to do that? I can make some referrals directly. The bigger the firm, the more they charge,
Well, I'm living in an Eastern Europe EU country and it's €125,000 here. I'm considering my options...
Do you have investors lined up? I explored setting up a fund before.. fortunately my prop firm gave me seed capital of a few million but considering there are setup charges, possibly staff costs, administration costs and then a standard fund gives 80% of its profits to investors (standard 2 & 20 deal). I don't think its worth setting up a fund unless you have at least 10 million in backing. After a year of doing it I realised you are far better off trading prop/own account. Would you rather have to make 5million a year to earn $250k or make $300k to earn $250k?
IMO, not incorrect but it would depend on your cost structure, scalability and expectations. For a strategy that does not lend itself to managed accounts, there are circumstances where some can start with $2mm even with an expectation of not going over $10mm if it is a 1 or 2 man shop, running their own funds anyway or want to manage money but don't want the clients to see their trading. Some strategies don't make sense under $50mm to start.
But if you're running your own money its not really a hedge fund is it? Its no different to a prop account until you get outside money in. Unless its just you and one other guy that says "heres 2mill you trade it and give me half, you get the other half". But I wouldn't go through the effort/cost of forming a "fund" to do that. Just setup a limited partnership