Alternative Investment Performance and Returns

Investment performance measurement on common asset classes, such as public equity and debt, is relatively straightforward. In alternative investments, there are unique features that make this asset class somewhat complicated when it comes to measurement of investment risk and return. In this learning module, we first discuss these unique characteristics and the challenges they pose to performance appraisal. Then we explain the various features in the complex fee arrangement in alternative investments and the nuances when it comes to calculating investor returns.