Tag Archive for: Pooled Funds

Pooled Fund Net Returns & Expense Ratios

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Looking for a little distraction to kick-start the spring?  We are highlighting five top performance Q&A’s focused on pooled fund expenses.

1. Someone said that the expense ratio should be annualized. What is the source for this requirement?

In the Explanation of the Provisions for Section 6, 6.A.5 it states that “Pooled fund expense ratios that are calculated for periods of less than one year must be annualized.” The expense ratio may also be shown in an exhibit if the exhibit is provided along with the GIPS Report.  Important consideration: During the first year of a fund’s life, expenses are often capped.  An annualized partial-year expense ratio would not ever be larger than the fund’s stated maximum annual expense ratio.

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GIPS® Reports – Managing Distribution Requirements

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GIPS Reports – Managing Distribution Requirements

Does your firm manage segregated accounts and pooled funds? Are you writing 2020 policies to provide a composite report with the fee schedule and expense ratio for the fund in the disclosures? Do you have policies requiring you provide a pooled fund report?  Are there ways to avoid having two different composite reports, one for prospective clients and one for prospective investors? 

Many firms don’t know in advance of initial meetings whether a prospect is going to be a prospective investor (in a pooled fund product) or a prospective client (in a segregated account).  So what if you provide a GIPS Composite Report—without your fund’s expense ratio or fee schedule—and the prospective client turns into a prospective investor?

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2020 GIPS® Standards Q&As

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This is a comprehensive list of Q&A’s released as part of the GIPS standards Newsletter, organized by subject matter.  As CFA Institute continues to add Q&As through the GIPS Standards Newsletter, we will continue to update this page.

GIPS 2010 Transition to GIPS 2020

Pooled Funds

Composite Management/Policies

Input Data and Portfolio Calculation

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