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I was looking at the HAF as a way to add some bond etf exposure to my portfolio. Can anyone outline, in plain english, what triggers to performance bonus, as outlined on the prospectus?

The Tactical Global Bond ETF Fund will pay to the Manager, in its capacity as
manager of the Tactical Global Bond ETF Fund, a performance fee (the “PerformanceFee”), if any, equal to 20% of the amount by which the performance of the Tactical Global Bond ETF Fund at any date on which the fee is payable (i) exceeds the High Water Mark (defined below) and (ii) outperforms the total return of a benchmark (the “Benchmark”) comprised as to two-thirds of the total return of the DEX Universe All Corporate Bond Index and as to one-third of the total return of the Barclays Capital
High Yield Very Liquid Index. The Performance Fee will be determined in accordance with the following formula:
20% x (A – (B x C)) x D
where:
A equals the Adjusted NAV per Unit as at the last day of the period in respect
of which the calculation is being made;

B equals the greater of: (i) the NAV per unit of the Tactical Global Bond ETF
Fund immediately following the closing of the Offering; and (ii) the highest
NAV per unit of the Tactical Global Bond ETF Fund previously utilized for
purposes of calculating a Performance Fee which was paid (the “High Water
Mark”);
C equals 1 plus the total return of the Benchmark expressed as a percentage forthe period in respect of which the calculation is being made; and
D equals the number of units of the Tactical Global Bond ETF Fund
outstanding as at the last day of the period in respect of which the calculation is being made.

No Performance Fee will be payable on any payable date unless A exceeds
B x C at that time. For purposes of the initial High Water Mark, B will be the
offering price per Unit of $10.00 less fees payable to the Agents for selling
Units and the expenses incurred in connection with the Offering as described
above.
As used herein, “Adjusted NAV per Unit” means the NAV per unit of the
Tactical Global Bond ETF Fund as at a particular date without giving effect to
the current day accrual of the Performance Fee, if any, and including the
aggregate amount of all distributions paid or payable during the period in
respect of which the calculation is being made.
 

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The actuality of when the payment is actually paid is quite annoying to follow and figure out, but the basic structure is this:

If the manager gets "lucky" enough to outperform some index then they get to take 20% of your profits above some point. If they are not "lucky" enough then they take a little less of your profits. If they lose all your money, then they go find someone else and take their profits.

You could probably sum up most 125 page prospectuses of managed funds with the 4 lines above.

That's pretty much what is going on there. Do yourself a favour and just buy the index fund/ETF.
 
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