Waiver Tier Rule Example

In the following waiver tier example, you define a tier for variable expense calculation and you define a separate tier for waiver calculation. The system calculates both expense and waiver by multiplying the Total Net Assets by the Percent Rate and dividing by the number of days in the year for each net asset tier that the Total Net Assets falls within.

For Total Net Assets of $350,000,000, $200,000,00 falls in the first tier with a Percent Rate of 0.002 (200,000,000 x .002 / 365 = $1,095.89) and the remaining $150,000,000 falls in the second tier with a Percent Rate of 0.0007 (150,000,000 x .0007 / 365 = $287.67) for a variable expense amount of $1,383.56 ($1,095.89 + $287.67).

For the waiver calculation, $150,000,000 falls in the first tier with a Percent Rate of 0.001 (150,000,000 x .001 / 365 = $410.96), another $150,000,000 falls in the second tier with a Percent Rate of 0.0003 (150,000,000 x .0003 / 365 = $123.29) and the remaining $50,000,000 falls in the third tier with a Percent Rate of 0.000275 (50,000,000 x .000275 / 365 = $37.67) for an expense cap of $571.92 ($410.96 + $123.29 + $37.67). The variable expense amount of $1,383.56 is greater than the expense cap amount of $571.92 so a waiver is posted for the difference of $811.64.