Alignment of Interests 2022 (Investor survey)

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* 1. What is the total amount of capital that you invest in alternative investment funds? When describing alternative investment funds, for the purposes of this questionnaire we mean hedge funds and private credit funds.

$1m-$100m

$101m-$250m

$251m-$500m

$501m-$1bn

$1bn-$2bn

$2bn +

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* 2. How do you best describe how your firm currently aligns interests with alternative investment funds that it allocates to? Please check all that apply.

Knowledge sharing with hedge fund(s) that it allocates to.

Co-invests with hedge fund(s)

Works with hedge fund(s) to build a more customised solution to address their risk and return appetite better

Risk Management and Reporting tools

All of the above

Other (please specify)

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* 3. From the list below, please check the ways how you believe alternative investment funds could better improve alignment of interest with their investors

Greater transparency

Preferential fee terms (i.e. hurdle rates, high watermark )

Customised solutions

Offer investors co-investment opportunities

Longer fee crystallisation periods

Tiered management fees

All the above

Other (please specify)

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* 4. When allocating to alternative investment funds, do you ask for. Please check all that apply.

a high watermark

a hurdle rate

clawback arrangement

fund principals to have a personal investment in the fund

full transparency regarding all fees being charged by the fund

is the fund a UNPRI signatory (and if so, share the annual PRI report)

All of the above

Other (please specify)

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* 5. Please select from one of the options below what is your preferred high watermark.

Standard high watermark (i.e. the fund is losing money, then fund manager has to return fund to previous high AUM level before being paid any incentive)

Modified high watermark (reset the high watermark to zero)

Amortising high watermark (amortise any losses over time)

Multi year rolling high watermark

Benchmark high watermark

No high watermark

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* 6. From the list of preferential terms below, what do you consider most important when negotiating the management fee on any one or more of the alternative investment funds that you invest in? Please check all that apply.

Founder share class pays a lower management fee

Fund offers a lower management fee with a higer performance fee

Fund provides tiered management fee rates

Fund offers lower fees to larger investors (through a specifc share class, share rebate, MFN)

Fund management fees are reduced in return for longer lock-up periods and/or notice periods.

Fund offers greater transparency of the portfolio in return for a higher management fee

Fund's management fees are aligned with the operating costs of the firm (research , operations, admin, trading costs)

All of the above

Other (please specify)

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* 7. When negotiating fees with alternative investment fund managers, are you more focused on reducing the performance fee or management fee? Please select from one of the options below.

Performance fee

Management fee

Both the management fee and performance fee

Neither focused on reducing the management fee nor the performance fee

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* 8. Which of the following best describes your approach to Responsible Investing? From the list of responses below, please select all that apply.

We invest in alternative investment funds that use ESG factors to evaluate investment opportunities

We invest in alternative investment funds that negatively screen companies

We invest in alternative investment funds that trade green bonds

We invest in alternative investment funds that pursue impact investing

We are not pursuing responsible investment mandates.

We only select funds that are UNPRI signatories

All of the above

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* 9. Choose from one option below what best describes your firm's position regarding co-investment.

We are co-investing with alternative investment funds

We do not have any co-investment arrangements with alternative investment funds, but are actively pursuing opportunities

We do not have any co-investment arrangements with alternative investment funds, but would consider this option

We do not have any co-investment arrangements with alternative investment funds

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* 10. What fee arrangements do you prefer for co-investment arrangements? Please select from one of the options below.

Pay the fee for co-investment only

Discounted management fee in exchange for co-investment.

Co-invest in a certain ratio to your fund investment at a discounted fee

Fee-free co-investment

N/A (no co-investment)

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* 11. How are returns typically allocated to you as investors? Please select the most appropriate response from the list provided below.

American distribution waterfall (i.e. the GPs performance is evaluated against the hurdle rate on a deal by deal basis and the GP is paid interest on a day by day basis).

European distribution waterfall (i.e. the GPs performance is measured against the hurdle rate at the fund level and is only paid carried interest once the return returns all capital contributions and the preferred return if any)

Hybrid distribution waterfall (designates American waterfall model for certain types of income (e.g. for operating income) and European waterfall for different income (e.g. sale proceeds)

Not relevant to my plan

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* 12. What period(s) do you prefer for fund fee crystallisation (i.e. the frequency of the period during which the performance fee, if any becomes payable to the management company)? Please select one option from the list of responses below.

N/A - there are no crystallisation of fees

Quarterly or less

Semi annual

Annual

Rolling 3 years

Greater than 3 years

Other (please specify)

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* 13. What expenses do you typically see "pass through" to you as investors? From the list of options below, please select all that apply.

Service provider costs (e.g. fund admin, custody costs)

Fund Expenses (e.g. Director fees, Audit fees, publication costs)

Operating Expenses (e.g. employee compensation, regulatory reporting costs, transfer agency fees)

Organisational Costs (e.g. legal set up fees)

Payment for research (i.e. broker research, expert networks)

Placement Agents

Alternative Data Sets

None of the above

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* 14. At what level do you typically cap any operating expense that you see passed through to the fund? Please select from one of the options below.

0-25bps

25-50bps

50-100bps

100bps or greater

Prefer not to say/non applicable

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* 15. What fee structure do you typically see on committed capital versus invested capital? Please select from one of the options below.

Managers charge less fees on committed capital by 50% or more

Managers charge less fees on committed capital by 25% to 50%

Managers charge on committed fees is 25% or less

Managers do not charge fees on committed capital

Managers charge the same fees on committed and invested capital.

N/A

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* 16. What do you look for in a fund manager that you allocate to, when thinking about how they align with your expectations as an investor? Please select all that apply from the list of responses below.

Full transparency regarding fees charged by the fund manager.

Flexibility regarding fees being charged by the fund manager

Fund manager is a UNPRI signatory

Fund manager offers strategic relationships with its investors

Other (please specify)

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* 17. Do you have anything else that you would like to add which can help us better understand how alternative investment funds can better align interests with investors? If so, please include in comment box below.

Alignment of Interests 2022 (Investor survey)

Examining the ways that investors align their interests with alternative investment fund managers

Question Title

* 1. What is the total amount of capital that you invest in alternative investment funds? When describing alternative investment funds, for the purposes of this questionnaire we mean hedge funds and private credit funds.

Question Title

* 2. How do you best describe how your firm currently aligns interests with alternative investment funds that it allocates to? Please check all that apply.

Question Title

* 3. From the list below, please check the ways how you believe alternative investment funds could better improve alignment of interest with their investors

Question Title

* 4. When allocating to alternative investment funds, do you ask for. Please check all that apply.

Question Title

* 5. Please select from one of the options below what is your preferred high watermark.

Question Title

* 6. From the list of preferential terms below, what do you consider most important when negotiating the management fee on any one or more of the alternative investment funds that you invest in? Please check all that apply.

Question Title

* 7. When negotiating fees with alternative investment fund managers, are you more focused on reducing the performance fee or management fee? Please select from one of the options below.

Question Title

* 8. Which of the following best describes your approach to Responsible Investing? From the list of responses below, please select all that apply.

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* 9. Choose from one option below what best describes your firm's position regarding co-investment.

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* 10. What fee arrangements do you prefer for co-investment arrangements? Please select from one of the options below.

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* 11. How are returns typically allocated to you as investors? Please select the most appropriate response from the list provided below.

Question Title

* 12. What period(s) do you prefer for fund fee crystallisation (i.e. the frequency of the period during which the performance fee, if any becomes payable to the management company)? Please select one option from the list of responses below.

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* 13. What expenses do you typically see "pass through" to you as investors? From the list of options below, please select all that apply.

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* 14. At what level do you typically cap any operating expense that you see passed through to the fund? Please select from one of the options below.

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* 15. What fee structure do you typically see on committed capital versus invested capital? Please select from one of the options below.

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* 16. What do you look for in a fund manager that you allocate to, when thinking about how they align with your expectations as an investor? Please select all that apply from the list of responses below.

Question Title

* 17. Do you have anything else that you would like to add which can help us better understand how alternative investment funds can better align interests with investors? If so, please include in comment box below.