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Here we feature the CAIA Association's latest Member Update, our exclusive member newsletter. For previous updates, use the archive on the right.

Director's Comments•Evolution of the CAIA Curriculum by CAIA Association Program Director•Smart Moves•CAIA Association is Hiring•Chapter Notes•AllAboutAlpha.com's Research Dossier •Job Board Highlight•Industry Conferences•

Dear Member,I'm pleased to unveil an important new ongoing educat ional resource for CAIA members: the CAIA Self-Evaluation Tool (SET).

The CAIA SET was developed for current CAIA members by the same team of experts responsible for the CAIA program. It features questions based on recent CAIA Level II curricula and is intended to provide you with a means for assessing your understanding of current research and practices in the alternative investments industry.

The 2011 Self-Evaluation Tool features:

Digital delivery through your caia.org account•17 multiple choice questions•3 constructed-response (essay) questions•Instant scoring•Supplementary notes•Links to the corresponding CAIA readings, now available as a benefit of membership•Annual updates for currency•

The CAIA Self-Evaluation Tool will be updated annually to incorporate changes in the curriculum. Beginning in November 2011, we will require CAIA members to complete the SET once every three years in order to

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6/10/2011http://caia.org/media-center/member-update

stay current and maintain use of the CAIA designation; each time you complete the SET the "requirement" clock will be reset for the next three years.

Of course, you're welcome and encouraged to review the SET as many times as you wish, and you don't need to wait until this fall to complete the 2011 SET! This is not a test and there is no "pass" requirement for maintaining the designation, but we expect our members to make every reasonable effort to carefully review and answer the questions.

I'm pleased also to introduce the new CAIA Member Library, which hosts the current CAIA Level II Core & Integrated Topics readings as well as other reading materials available exclusively to CAIA members.

I invite you to get started with the 2011 CAIA Self-Evaluation Tool and the Member Library today.

Kind regards,

Maia Porter Director of Member Services

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Evolution of the CAIA CurriculumAs the CAIA Association approaches its 10th anniversary, it's instructive to look back at the evolution of our curriculum. Over the first six years, we relied almost entirely on materials not produced by the Association. Since alternative investments were not widely used or known by the larger investment community, our curriculum had the relatively easy task of introducing our candidates to alternative investments and providing them with a basic understanding of risk-return characteristics of these products as wel l as their place in institutional quality portfolios. At this time there was little in terms of academic and practitioner research in many areas of alternative investments.

In addition to using materials produced outside of the Association, our earliest Level I curriculum also devoted about one-third of its space to traditional asset classes. As we surveyed the industry, it became clear that the time had come to redesign the CAIA program. First, the traditional materials were moved out of Level I and occupied what was known as the pre-requisite program. Second, a portion of what was then Level II material was redesigned to fit into the Level I program. Third, we used part of the Level II of our program to drill down into one or two specific strategies (e.g., convertible arbitrage) in order to better understand how to implement and manage a strategy with changing economic conditions. Fourth, we created a new portion of Level II—called Current and Integrated Topics— to bring the latest developments of the field into CAIA front and center.

That was then and this is now. The growth of our association and the dynamism of the alternative industry led us to the logical next step— CAIA producing its own materials. It became clear that our curriculum must keep up with rapid changes in the industry and use a consistent framework for a fundamental understanding of alternative investments, thus enabling our members to evaluate and use these new products.

This fundamental understanding of alternative investments has now become a focal point of the CAIA curriculum. As an example, a decade ago, pure manager skill was thought to be the primary source of excess return to alternative investments and subsequently many actively managed products were thought to produce absolute return to their investors. Today, the concept of alpha has become more complex and therefore we've developed a whole set of new concepts and terminologies to describe the risks and returns associated with alternative investments – the so-called "alternative betas." We now have a vast amount of research that shows most alternative investments earn excess returns for taking on risks that many traditional investors are not willing or able to take, or for providing liquidity, hedging and similar benefits to other market participants. Such a fundamental understanding of alternative investments will equip our members with the practical knowledge needed to understand and manage the complex and rapidly changing world of alternative investments.



We now know, for instance, that equity market neutral hedge fund strategies are not entirely skill-based investment products and, contrary to what is implied by their name, are not free of all systematic sources risk. Recent research has shown that many equity market neutral strategies tend to be mean-reversion and therefore have significant exposure to market liquidity conditions. Given this understanding, a CAIA member would therefore be able to anticipate how an equity market neutral strategy would behave during a period when the liquidity needs of the market change drastically. In addition, we have known for years that investments in private equity or real assets allow investors to earn an illiquidity premium not offered by liquid listed securities. However, we are just now learning about the impact of illiquidity on a portfolio's performance and ways to manage this risk. The list of new insights provided by recent academic and practitioner research on the fundamental characteristics of alternative investments is long. It is up to us to incorporate these findings into an accessible curriculum so that our candidates and members are able to anticipate how various investment products are likely to behave under changing economic and f inancial conditions.

The curriculum team of the CAIA Association, along with groups of volunteers who include CAIA members and non-members have been working for the past two years on a major revision of our study materials. This revision, which will be released next year, will represent another major step in the evolution of our curriculum that meet the goals described above. I t will present a set of principles that will help our members to continue to educate themselves long after they have been awarded their CAIA designation. The tools and the knowledge provided by our curriculum will enable our candidates and members to look at new investment opportunities in the alternative investment industry with a critical eye, and to differentiate between sustainable sources of return and diversification benefits from those that are likely to disappear at the first signs of market dislocation.

— Hossein Kazemi, Ph.D., CAIA Program Director

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Smart MovesEelco Fiole, CAIA, has joined Credit Suisse Asset Management as Chief Operating Officer, Alternative Investments in Zurich, Switzerland. In his new role, he is responsible for supporting the development and execution of the strategic objectives for distribution, management of the organizational infrastructure and improving linkages across the firm.

Previously, Eelco managed a variety of projects, primarily in emerging markets as a consultant for financial institutions based in Zurich and Singapore. Prior to his consulting work, he was Group CFO of Millennium Global Investments in London and CFO and Head Corporate Development of Centrum Bank in Vaduz. He also held various financial management positions at UBS in Basel and Zurich. Eelco began his

career in finance as a corporate and institutional banker with ABN AMRO in The Netherlands after a few years in process engineering.

An inaugural member of the CAIA exam council and a past senior grader, Eelco comments, "My CAIA designation has provided me with an excellent foundation and up-to-date knowledge in an array of AI-topics, which was extremely useful in my previous roles and continues to be a valuable asset in my current position. Also, the global CAIA-network has proven to be highly stimulating and valuable".

Eelco earned a PhD in Economics from the University of Basel, a postgraduate cer tificate in Laws from the University of London, an MSc in Business Administration from RSM Erasmus University and a BSc in Mechanical Engineering from Rotterdam University. Having taught finance in the past, he currently holds a lectureship in finance ethics at the University of Lausanne.

Eelco has been a CAIA member since October 2006. He also holds the CFA, FRM, and CMA designations.



Sushil Kedia, CAIA, has become the first Asian to be elected to the Board of Directors of the Market Technicians Association (MTA), a global association of technical analysts. During his three-year term, he will focus on helping to expand the growth and organization of technical analysis across Asia.

Sushil is an independent technical analyst and investment advisor based in Mumbai. He has produced quantitative strategy for a Pan-Asian long short hedge fund in the last few years. Sushil has extensive experience of nearly two decades in trading, research and investment management in primarily Indian markets dominantly and more recently in other Asian markets as well. He is regularly consulted for his market opinion by major business news networks as well as national financial publications in India. He

also writes for a few U.S. based popular market blogs.

A member of the CAIA Class of September 2007, Sushil writes: "The CAIA designation provided me with structured learning into alternative investments in a comprehensive way. In the evermore rapidly evolving universe of investments, membership in the CAIA Association is a critical tool in keeping me at the leading edge."

In addition to his CAIA designation, Sushil holds the CMT and FRM designations. He is the Founder President of the Association of Technical Market Analysts, India.

Sushil holds graduate degrees in Accountancy & Business Economics and an MBA from XLRI Jamshedpur School of Business. Sushil expects to complete his M.Sc. (Financial Engineering) degree from the National University of Singapore in the autumn of 2011.

Sam Martin, CAIA, joined State Street Corporation as a Vice President, Senior Hedge Fund Credit Risk Analyst. As part of the enterprise risk management division, he provides credit and risk rating recommendations based on analysis and due dil igence on hedge funds, private equity funds, banks, and broker-dealers who have banking and trading relationships with State Street.

Prior to State Street, Sam worked at Boston Technologies, a leading provider of software, solutions, services and trading platforms to institutional and retail brokerage firms in the FX, CFD, commodities, futures and options marketplace.

As we announced in the December Smart Moves, Sam previously worked for Indaba Global Research as Managing Director & Partner and focused on all areas of the building the business including sales, research and product development. Prior to Indaba, he spent three years as a hedge fund research consultant at NEPC where he was responsible for manager selection and portfolio construction for large institutional investors. Prior to NEPC, Sam worked in the Prime Brokerage division at Bear Stearns for over five years. He also worked as a quantitative analyst at Putnam Investments and as a research analyst at SSgA.

According to Sam, who has been a CAIA member since April 2010, "The CAIA designation has been instrumental in helping me develop my diligence and evaluation skills of sophisticated alternative investment strategies. I feel I am better equipped to understand the unique needs of hedge fund and private market institutions."

Sam received an MBA and MSF from Boston College, and a BA in Economics from Bates College.

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CAIA Association is HiringThe Chartered Alternative Investment Analyst Association® (CAIA), based in Amherst, Massachusetts, is looking for a Director of Business Development, Americas, to promote the CAIA designation throughout the USA, Canada and South America. This position will build on CAIA's excellent reputation and success by executing CAIA's comprehensive business development strategy in the Americas and by promoting the Association's program to financial firms, industry associations and stakeholders, and regulatory bodies.

The ideal candidate possesses at least five years' experience in the finance industry (preferably in the alternative investment sector in business development or sales) and strong relationship management, communication and presentation skills. The position will likely be based in New York and will require extensive travel throughout the Americas.

CAIA is an independent, not-for-profit global organization committed to education and professionalism in the field of alternative investments. Founded in 2002, the Association is the sponsoring body for the CAIA designation. Recognized globally, the designation certifies one's mastery of the concepts, tools and practices essential for understanding alternative investments and promotes adherence to high standards of professional conduct. CAIA is an Equal Opportunity Employer (EOE).

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Chapter NotesUPCOMING CAIA GLOBAL CHAPTER EVENTS:

CAIA Chicago Educational Event Thursday, June 30, CME Group Auditorium "Commodities/Energy Risk Management" Hilary F. Till, Research Associate, EDHEC-Risk Institute, Fellow, Arditti Center for Risk Management, DePaul University and Principal, Premia Capital Management; Jeff Mantel, Ph.D., CEO, MantelGroup; Nedia Miller, Founder of MILLER CTA, Member of CME GROUP Jointly presented by CAIA Chicago, PRMIA Chicago and the DePaul University Arditti Center for Risk Management

CAIA Chicago Educational Event Thursday, July 7, De Paul University "How do Managed Futures Fit into an Institutional Portfolio?" Thomas Lott, Principal, Potomac Portfolios LLC; Brian Walls, Global Head of Research, Newedge Prime Brokerage Details TBA

CAIA France Educational Event Wednesday, June 15, ESCP Europe "Boom and Spikes in Commodity Markets: Funds or Fundamentals?" Helyette Geman, ESCP Europe & University of London

CAIA Germany Networking Event in Munich Wednesday, June 29, Salotto

CAIA London Networking Event Wednesday, June 13, Puncheon

CAIA New York Educational Event Wednesday, July 13, Club 101



"Global Macro Panel" Details TBA

CAIA San Francisco Educational Event Thursday, June 23, Mandarin Oriental Hotel "Investing in Quant Strategies: Thinking Outside the Black Box" Jim Creighton, Massif Partners; Michael Kharitonov and Jon McAuliffe, Voleon Capital Management; and Catherine Hsiao, Senior Research Analyst, Fiduciary Research and Consulti ng

CAIA Switzerland Networking Event in Geneva Thursday, June 30, Riverside Café

UPCOMING MEMBER COMMUNITY EVENTS:

CAIA Networking Event in Australia Thursday, June 7, Verandah Bar and Bistro, Sydney

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AllAboutAlpha.com's Research Dossier HighlightRetail Alternative Products and Strategies 2011

By: Cerulli Published: May 2011

Abstract: In its second iteration, this annual report focuses on ETFs and alternative products and strategies distributed through the retail third-party intermediary channel. The products analyzed in this report include: alternative (including commodit ies) mutual funds and ETFs, traditional ETFs, hedge funds, and structured products (including exchange-traded notes). This examination focuses on the size of each market, trends in product development, advisor usage and demand, and marketing and distribution.

Click here to continue.

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Job Board HighlightPortfolio Manager, Alternative Investments Montana Board of Investments Helena, MT, USA

The position is responsible for all activities related to the management of the Private Equity Portfolio and the Real Estate Portfolio, consisting of assets aggregating $1.4 billion. The private equity portfolio consists of underlying investments in buyout, venture, debt and special situation funds; while the real estate portfolio includes a combination of open-end core, and closed-end funds consisting of commercial properties and timberland.

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Industry ConferencesJune



4th Annual SuperReturn US June 6 - 9, 2011 CAIA members receive a 15% discount.

Venture Capitalist Investing Conference June 7 - 9, 2011 CAIA members receive a 50% discount.

American Conference Institute's National Summit on the Future of Fiduciary Responsibility June 9 - 10, 2011 CAIA members receive a 15% discount.

Niagra Institutional Dialogue June 13 - 15, 2011 CAIA members receive a 20% discount.

RealShare Chicago June 15, 2011 CAIA members receive a $50 discount.

Opal Financial Group's European Family Office & Private Wealth Management Forum June 15 - 17, 2011 CAIA members receive a 20% discount.

Brooklyn Real Estate Summit June 16, 2011 CAIA members receive a 20% discount.

Energy and Utility Forums Funding Renewables June 16, 2011 CAIA members receive a 10% discount.

Battle of the Quants June 16, 2011 CAIA members receive a 15% discount.

Buying and Selling Distressed Mortgage Portfolios Forum June 16 - 17, 2011 CAIA members receive a 15% discount.

17th Annual GAIM International 2011 June 20 - 23, 2011 CAIA members receive a 15% discount.

Hedge Fund Re-domiciliation for Managers & Funds June 28, 2011 CAIA members receive a 15% discount.

July

Hedge Fund Operations July 6 - 7, 2011 CAIA members receive a 15% discount.



Opal's Family Office and Private Wealth Management Forum July 18 - 20, 2011 CAIA members receive a 15% discount.

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