Because you charge as much as you can. People don't start hedgefunds because they have some altruistic need to create wealth for others, they do it so they can create wealth for themselves. If you could generate 20% returns and have $6.5 billion under management why would you lower your fees? SAC doesn't really need to raise any more capital and I am sure this new fund will fill up rather quickly. New managers do give fee breaks, but their performance is untested so there is much more risk in investing with them. SAC has a stellar track record so they can afford to charge such high fees. 5yr