d

问题如下：

A pension fund manager is planning to invest a portion of the fund’s portfolio into hedge funds. The manager is concerned about the potential asymmetry in risk sharing that may occur with hedge fund investments. What action should the pension fund manager take to mitigate this risk?

选项：

A.Allocate the money across several different hedge fund strategies to diversify away the asymmetry in risk sharing.

B.Choose a reputable hedge fund manager that manages investments for other major pension funds.

C.Ensure that the hedge fund managers have a sizable amount of their own wealth invested in their fund.

D.Require the hedge fund to provide a daily position report to better monitor the potential asymmetry in risk sharing.

解释：

The risk sharing asymmetry is a situation where the hedge fund manager fully enjoys the benefits of upside risk (incentive fees), but only partially suffers from the consequences of downside risk (loss of incentive fees, but does not lose their own capital), whereas the investor fully participates in both upside and downside risk. This asymmetry might cause a hedge fund manager to take excessive risk, especially in cases where the hedge fund is far below its high water mark so managers would need to realize a substantial gain to bring the fund back above that mark in order to begin earning incentive fees again. The most prudent approach to mitigating this risk is to ensure that the hedge fund manager has a sizable portion of their own wealth invested with the hedge fund, so that the hedge fund manager would be more conservative in their risk taking and consider both upside and downside risk.