Just to be clear a high water mark isn't a hurdle rate in the sense the OP was talking about.
In hedge fund land a high water mark means that if a fund loses money they won't take fees again until they've gotten back to their original high water mark.
ie you invest at 100, they gain 10% after fees so your units are worth 110.
The next year they lose 10% so your units are worth approx. 99.
Now the high water mark is 110.
Next year they make 5% so your units are worth approx. 104%. T his year the fund doesn't take performance fees as they haven't cleared their high water mark yet.
Point being the high water mark is relative to their own fund and has nothing to do with the market or any other benchmark.
If a fund only takes performance fees after a certain hurdle rate that is becoming more common but would be described by some other term.
Several funds have performance fees. It's typically the high-water mark (HWM) fee for profits above reference index returns.