That’s why we believe in performance-linked fees. All Aperture strategies utilize performance-linked fee structures. Each strategy charges a fee competitive with that of comparable passive ETFs if performance is at or below its stated benchmark. As outperformance is generated, each strategy is charged a performance-linked fee of 30% on returns generated in excess of the stated benchmark. At right is a a hypothetical strategy charging a minimum fee of 0.50%.
For example, with 0% outperformance, an investment of $100 would be charged a $0.50 fee ($100 x 0.50%). With 1% outperformance, that same investment could be charged a fee of $0.80 ($100 x 0.50% = $0.50, plus the performance-linked component, $1 x 30% = $0.30). If your investment was $10,000, and the outperformance was 1.5%, the fee would be 0.95% = $95; however if the outperformance was 4% the fee would be 1.7% = $170.2
2. This is an illustrative example only. Fee and performance calculations occur daily and actual outcomes over an entire year will depend on average assets over the course of the year, capital inflows / outflows, when the investor enters / exits the fund, and other factors.
*Important information: Investments involve risks. Past performance is not a reliable indicator of future performance and can be misleading. There can be no assurance that an investment objective will be achieved or that there will be a return on capital. You may not get back the amount initially invested. Before taking any investment decision, please always read the associated legal documents.
Indices are unmanaged and do not include the effect of fees. One cannot invest directly in an index. Morningstar Category data is for Institutional share classes of funds in the Emerging Markets Bond category. Avg. Fee equals the average Prospectus Net Expense Ratio. Morningstar data is as of 8/31/18.
Aperture is all about alignment, which is why the compensation of our investment teams is designed to put client results first, with an emphasis on consistent outperformance.
Aperture investment teams receive modest base salaries by industry standards.4
Aperture’s investment teams can earn up to 35% of performance-linked fees charged to the strategy (30% of performance in excess of the benchmark), paid on generated outperformance, for a total of up to 10.5% of total outperformance.
Deferral and Clawback
The deferral structure applied to Aperture’s platform strategies is designed to incentivise long-term performance. Half of performance comp is paid out on the past year’s performance. The other half is paid on cumulative outperformance over a 3-year period, including the following two years. The investment team’s cumulative outperformance over that 3-year period must be at least as great as the outperformance in the first year in order to earn all deferred comp. Deferred comp is decreased pro-rata by any underperformance. Unearned compensation is returned to the strategy over time.
4. We compared our typical investment team professional’s base compensation to the salaries of people with the titles “Chief Investment Officer” and “Senior Portfolio Manager” in the Greater London, United Kingdom area using LinkedIn Salary, which bases its estimates on information voluntarily provided by members and employers as of 15/08/18.