What is LEHMAN FORMULA?

Lehman Brothers’ investment bankers’ compensation formula. Developed by the securities trading firm. Originally, fee or brokerage computation: (1) Transaction sum’s 1st million times 5 percent; (2) 2nd million times 4 percent; (3) 3rd million times 3 percent; (4) 4th million times 2 percent; (5) whatever is left times 1 percent. A multiple of these percentages is typically demanded by the brokers during times of high inflation.

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