Exemptions for Advisers to Venture Capital Funds, Private Fund Advisers With Less Than $150 Million in Assets Under Management, and Foreign Private Advisers

One issue with using portfolio holdings to evaluate fund performance is that the disclosed data reveal information about the major equity positions at particular dates but do not indicate the exact purchase and sale dates. As a result, the exact holding period of securities is unknown. Furthermore, some funds may window-dress their portfolios to hide their actual investment strategy from their investors or from competing funds, as shown byMeier and Schaumburg (2004).Thus, studies analyzing only the returns of the disclosed holdings might be subject to significant measurement error, as they do not capture interim trades and various hidden costs. Our paper examines the difference between holdings and investor returns and...