Private Debt

Glossary

'40 Act

The 1940 Investment Companies Act, an act of the US Congress that regulates the oversight of investment companies and their product offerings.

AFFE

Acquired fund fees and expenses (AFFEs) are fees charged by BDCs that mutual funds and other registered funds must aggregate with their own fees when reporting expense ratios.

Alpha

The portion of total investment return attributable to manager skill and not market return.

Alternative risk premia

The portion of total investment return attributable to common factors (value, growth, momentum) that are thought to potentially provide long‐term incremental return due to investor behavioral biases.

ASC 820

The generally accepted accounting principal (GAAP) standard that dictates how the fair value of assets is determined, breaking up the process of valuation into three levels. (See also Level 3 Assets.)

Asset weighted

An index or portfolio whose security holdings and returns are weighted by the asset value, as opposed to equal weighting.

Bloomberg Barclays 3–5 Year Treasury Index

A fixed income index comprised of publicly issued US Treasury securities that have a remaining maturity greater than or equal to three years and less than five years.

Base rate

A short‐term, typically floating, interest rate (e.g., Libor, Prime, T‐bill, Fed Funds) which, in addition to a constant spread to compensate for credit risk, determines the amount of interest periodically paid to the lender by the borrower; also called the reference ...