Forward Fees

This article was originally published in the Investment Funds Practitioner in May 2011.

When the use of forward agreements is a material feature of a fund, we have been raising comments to request the disclosure of fees and any other costs associated with the forward agreements. One filer submitted that full, true and plain disclosure would be provided without the disclosure of such fees, and that this information was proprietary; however, the forward agreement fees, generally, have been material enough to persuade staff that this information is key to investors. Filers have shown the fees as a percentage of the forward agreement and have disclosed either the maximum percentage or a range.