Q & A Database

The GIPS Standards Q&A database contains questions and answers (Q&As) on various searchable topics that provide additional interpretation on an issue. Q&As are considered to be authoritative guidance and must be followed in order to claim compliance with the GIPS standards.

Content from prior Q&As was included in the GIPS Standards Handbook as much as possible and many Q&As were archived. Change the Status drop-down filter to "Archived" to see the archived Q&As.

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Archived

Effective: 1 March, 2006 - 31 October, 2012

Categories: Incubator Funds

Source: GIPS Handbook, 2nd Edition

How should incubator fund performance be presented under the GIPS standards?

Incubator funds typically are accounts set up with firm assets to initiate a new style of asset management. As such, they are typically non-fee-paying accounts. The Standards only require fee-paying portfolios to be included in the firm’s composites. However, the Standards permit firms to include non-fee-paying portfolios in its composites. If non-fee-paying portfolios are included in one of the firm’s composites, the Standards require that the firm present the percentage of the composite assets represented by the non-fee-paying portfolios as of the end of each annual period.

If the fund represents an investment style or objective that is unique with respect to other management styles of the firm, it must be included in a single-portfolio composite. However, if at any time the firm discontinues this strategy, the composite would also discontinue.

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