Photo: AP

The hedge fund industry is in the midst of a slow-motion disaster, as its biggest investors come to the realization that the fees hedge funds charge make most of them a scam. One hedge fund guy is embodying the industry’s clueless resistance to change, in hilarious fashion!

Just to “set the scene” for you here: hedge funds have traditionally charged their investors fees of about 20% of profits, and 2% of assets under management each year—meaning that a hedge fund with, say, $10 billion to manage would be paid $200 million a year even if it lost money. Investors have been willing to pay these huge fees for decades out of the (usually mistaken) belief that their hedge fund manager is the genius who will beat the average. In aggregate, hedge funds have been doing way worse than a simple U.S. stock index fund for close to a decade now, in large part because of the huge fees.

So lots of big investors are now publicly questioning the hedge fund business model and some pension funds have begun getting out of hedge funds altogether and the industry is in general having a Come to Jesus moment about its laughably scam-like fee structure. (You can read a much longer explanation of all this here if you like.)

With all of this as the backdrop, ENTER: Paul Tudor Jones, one of the most prominent hedge fund mangers in history. He’s posted solid returns since the 1980s, which is why he manages more than $10 billion, but things have changed. Lately the returns on his funds suck! His main fund is down nearly 3% already this year. Investors are pulling money. So Paul Tudor Jones is doing something drastic—cutting his fees. Now, Bloomberg reports, his investors can lose money for an absolute bargain price:

The $11.6 billion firm, run by billionaire Paul Tudor Jones, will reduce fees for a share class that contains most of its biggest fund’s money to 2.25 percent of assets and 25 percent of profits, starting July 1, according to a letter sent to clients on Monday and obtained by Bloomberg. The fees were 2.75 percent and 27 percent.

Wow, only 2.25% of your total money and 25% of your profits for the privilege of making this guy rich(er)! Run don’t walk!

Paul Tudor Jones is worth about $5 billion and now you know why.