Fidelity Alternative Investment Solutions Presentation subtitle
Month DD, YYYY
Speaker Name Speaker Title Speaker Name Speaker Title Speaker Name Speaker Title
Not FDIC Insured May Lose Value No Bank Guarantee
For investment professional use only. Why Offer an Alternative Investment Solution? Investors are looking to their financial advisors for guidance about the benefits of incorporating alternative investment strategies into their portfolios
Reduced Increased Enhanced Yield Low correlation volatility diversification* returns generation to equity markets
91% 51% of investors have at least some interest of investors will seek to execute alternative 56% of investors indicated their advisors have in understanding how alternatives could investment strategies through a financial not discussed alternative investments help them meet their financial goals advisor over the coming years
* Diversification does not ensure a profit or guarantee against a loss. Source: Investment News, “Reframing the Role of Alternatives.” 2 For investment professional use only. Historical Barriers to Investing in Alternatives Historical barriers have made it challenging for advisors to allocate to alternative investments
• $1M+ minimum investment often required High investment minimums • $10–20M investment to build a diversified portfolio
• Difficult to gain access to top-performing managers Access to managers • Hard to identify and compare performance across managers and strategies
Investment research and • Challenging to identify top-performing managers operational diligence • Increased complexity and costs to perform operational due diligence compared to public markets
Complicated manual • Manual and paper-based subscription documents investment processes • High rates of NIGO subscriptions
Complex tax filing • K1 tax filing report and administration • Multiple statements issued to investors
3 For investment professional use only. Why Fidelity Alternative Investing? Fidelity’s alternative investment solutions are designed to help you overcome the barriers to investing in alternatives, while providing flexibility and choice at low cost
Broad set of alternative investment Flexibility to invest how Simplified solutions to meet your client needs you choose for your clients administration
• ~$30B in AI assets under custody AI Network • Online order entry process for increase trade transparency and efficient workflow • ~3000 CUSIPs • Low minimums, registered non-traded alternative investment products • Subscription, redemption, capital commitment • Range of products available for accredited and capital call processing investors and qualified purchasers • 1099 tax reporting • No transaction or custody fees • Online search tools to determine product • Many products with low minimums availability • Registered and private securities supported Strategic Alliances • Alliances with industry-leading providers • “Above the line” reporting on client statements • Retirement and non-retirement accounts including CAIS, Goldman Sachs, and iCapital • Consolidated tax reporting and 990-T filing eligible • Programs provide access to institutional managers at lower minimums along with research and diligence
Core Custody Solution • Open-architecture solution enabling custody of products you identify • Capability to support various investment structures including LPs, LLCs, private equity and private debt
4 For investment professional use only. AI Network and Strategic Alliances Simplify the process of investing in alternative investments through AI Network and Fidelity partners
Goldman Sachs AI Network CAIS iCapital Asset Management Evolving menu of strategies ESG, GP stakes, hedge fund BDCs, direct lending, REITs, Curated menu of hedge funds, Strategies including hedge funds, private of funds, private credit, private registered hedge funds, and private credit, private equity, and available credit, private equity, and private equity, private real estate, and registered private equity funds private real estate real estate exchange funds Typical $5,000–$50,000 $100,000–$250,000 $100,000–$250,000 $50,000–$1,000,000 minimums1 Institutional quality research and Research Research and diligence materials Independent due diligence provided Research and diligence materials diligence conducted by iCapital’s and diligence provided by fund sponsors by Mercer Investment Services provided by GSAM investment team Education Timely thought leadership, portfolio Platform and product consultant CAIS IQ online learning system; Online education center and and client construction, and risk management available to assist you may be eligible for CE credit Investor Relations Help Desk support consulting No custody fee; No custody fee; No custody fee; Fidelity fees No transaction or custody fees transaction fees may apply transaction fees may apply transaction fees apply Subscription Paper transaction documents Electronic transaction documents Electronic transaction documents Paper transaction documents documents Asset acceptance Not required Not required Not required Not required review Additional Contact your Relationship Manager caisgroup.com icapitalnetwork.com gsam.com information to learn more
¹ Actual investment minimums may vary by each fund and may not fall within the stated range. 5 For investment professional use only. Core Alternative Investment Custody Program Designed to be a flexible solution enabling you to custody non-traded securities alongside other investments at Fidelity
Features and benefits Efficient asset acceptance review • Open-architecture solution enabling custody and asset servicing for non-traded process to onboard new securities securities
• Flexibility for you to consolidate additional client assets Online tool to determine if security • Increase client confidence that positions are held alongside other securities at is available for investment Fidelity and appear “above the line” on statements • for subscriptions, Efficient administration and electronic order submission Submit fund documents to initiate redemptions, and capital call commitments asset acceptance review if security • Simplified tax administration: Consolidated 1099 reporting and 990-T processing is not already available at Fidelity • Value: Low-cost custody and transaction fees¹ Fidelity conducts an operational Broad range of product structures supported review to determine if the security • Business development companies is eligible for custody • Private debt
• Private equity Fund sponsor executes a custody • Private investment funds (LPs, LLCs, FoFs) agreement with Fidelity • REITs
¹ Refer to client billing schedule for additional details on custody and transaction fees. 6 For investment professional use only. Transaction Processing and Reporting Electronic order management tools create efficiency for advisors, while clients benefit from “above the line” reporting on statements
Electronic trade order to submit transactions and Real-time order tracking to view order status required transaction documents
Positions appear “above the line” on client statements
Screenshots are for illustrative purposes only. 7 For investment professional use only. To learn more about Fidelity’s alternative investment solutions, contact your Fidelity representative and request to speak with an alternative investment Subject Matter Expert.
Information provided in this document is for informational and educational purposes only. To the extent any investment information in this material is deemed to be a recommendation, it is not meant to be impartial investment advice or advice in a fiduciary capacity and is not intended to be used as a primary basis for you or your client's investment decisions. Fidelity, and its representatives may have a conflict of interest in the products or services mentioned in this material because they have a financial interest in, and receive compensation, directly or indirectly, in connection with the management, distribution and/or servicing of these products or services including Fidelity funds, certain third-party funds and products, and certain investment services. Third party marks are the property of their respective owners; all other marks are the property of FMR LLC. The content provided herein is general in nature and is for informational purposes only. This information is not individualized and is not intended to serve as the primary or sole basis for your decisions as there may be other factors you should consider. Fidelity InstitutionalSM does not provide financial or investment advice. You should conduct your own due diligence and analysis based on your specific needs.Third party marks are the property of their respective owners; all other marks are the property of FMR LLC. Third parties referenced herein are independent companies and are not affiliated with Fidelity Investments. Listing them does not suggest a recommendation or endorsement by Fidelity Investments. Fidelity InstitutionalSM provides clearing, custody, or other brokerage services through National Financial Services LLC or Fidelity Brokerage Services LLC, Members NYSE, SIPC. © 2020 FMR LLC. All rights reserved. 1.9894478.102 664401.10.0 0920