1. Trends in Alternative Asset Management Andrew McCollum Principal, Greenwich Associates May 2, 2012

2. Funding gaps remain a problem for U.S. corporations and public funds. 1 CONFIDENTIAL Source: Greenwich Associates 2011, U.S. IMF-11. Mean calculation excludes reported answers of "0" and / or "None". U.S. Corporate Funds’ Average Funding Ratio of DB PlansU.S. Public Funds’ Average Solvency Ratio of DB Plans 7.6% actuarial assumption

3. 2 CONFIDENTIAL Allocations have changed significantly over the past ten years, with allocations to alternatives up dramatically. Corporate DB Public DB Endowment/ Foundation Source: Greenwich Associates, 2011.

4. Allocations to alternative asset categories is expected to increase further in the years ahead. 3 CONFIDENTIAL U.S. Investors’ 3-Year Institutional Asset Allocation Expectations Source: Greenwich Associates 2011, U.S. IMF-11. Note: Three year outlook. “No Change” column indicates number of U.S. investors with no allocation changes planned for a given asset class. Results are for corporate and union fund defined benefit plan assets, public fund defined benefit plan assets, and endowment and foundation fund investment pool assets. No Change 467 489 496 506 496 487 475 459 473

5. 4 CONFIDENTIAL Most Important Hedge Fund Selection CriteriaTop Hedge Fund Strategies Currently Employed, by Assets Source: SEI/Greenwich Associates Hedge Fund White Paper 2011. To meet with success in the institutional market, firms must align products, business model, and communications with client needs.

6. 5 CONFIDENTIAL Key Takeaways ▪Evolving client needs will drive further demand for alternatives products. ▪Alternatives managers will face increasing competition (and vice versa) from traditional long-only managers. ▪Increased competition will “institutionalize” the alternatives industry, impacting business models, client servicing, communications, operations, and fees, among other areas. ▪Alternatives firms must evolve to meet this shifting landscape. ▪The alternatives industry will require talented – and qualified – individuals to address these challenges.