CFA Level I Alternative Investment Performance and Returns question

Alternative Investment Performance and Returns sample question

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Alternative Investments

Alternative Investment Performance and Returns

Kestrel Bay Fund begins the year with net asset value of USD80 million and ends the year at USD89.6 million before fees. The fund charges a 1% management fee on beginning NAV and a 15% incentive fee subject to a 6% soft hurdle. The hurdle is measured on the return net of the management fee, and once the hurdle is exceeded the incentive fee applies to the entire gain net of the management fee. The investor's net return is closest to: