Chartered Financial Analyst Level 1

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Which of the following statements about alternative investments' compensation structures is most accurate?

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Last updated: December 6, 2025 at 10:11

A

A hurdle rate protects clients from paying twice for the same performance

B

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The management fee for a private equity fund is based on committed capital until fully drawn

C

The management fee is earned only after the fund achieves a return known as a high-water mark

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