Chris Donahue: Okay. Thanks. And so what’s really going on here is it’s almost independent decisions in addition to filling out a core position, those FAs that are willing to lengthen duration like the product. The product does a very good job of capturing alpha on the downside and on the upside. And if you look at its three year rolling returns over 72 periods, about 90-some percent of the time, this fund beats the competitors and the bench. And so it’s a very solid product. And others are consolidating managers and doing other things like that. And that’s why you’re seeing these strong flows into the total return bond fund category.
Daniel Fannon: Okay. Thank you. That’s helpful. And then I was hoping to clarify some of the dynamics within the carried interest in the quarter. I think you mentioned the restructuring of the infrastructure fund. So – and I believe something else I might have missed it. But if you could just talk about specifically what happened and then the understanding what the impact was to carried interest and comp. But I believe there was – is that partly why the elevated legal costs as well? I just want to make sure we’re looking at the kind of normalized expense levels exiting kind of the second quarter would be helpful.
Tom Donahue: Yes. Okay, Dan. That’s why we put that kind of specific things in the press release under financial summary, but just to talk about it. So we have the Horizon product, which has a long-term large private equity investor was looking to exit some of their position and we worked on this for a long time and they were able to complete the transaction, sell their position to somebody else and importantly, we still are managing it. So it’s just we’re managing it for somebody else. That triggered the carry from the gains that they got by selling it, which triggered the carrier of which we get some of it, we being the ink and which the managers get some of it, which is why it is compensation. So that standalone by itself, that would have been a positive contribution to earnings.
So the second transaction was in our infrastructure business, where we kind of looked at it and realized that we needed to update it to more satisfied the existing investors and to transfer it into a better structure to grow it in the future And that – what that did was triggered carried interest from the past that we were able to recognize. The reason why we were able to recognize it – the reason why we didn’t recognize it before it was because there was a clawback. Once we restructured it, the clawback ends and therefore, we recognized it. And what we also had to do was went out and got a fair market value of the cherry for the people who get the carried interest, and we had to take that as an expense. By the way, that was not a comp expense even though it’s paid to the employees and it shows up in the other line.
Now both those things, and we continue to manage that portfolio too. And I think it’s important for Saker if he wants to make any follow-up comments on those businesses.
Saker Nusseibeh: Sure. Thank you. So two things about this. One, if you think about the first transaction, it is actually a success because when you have a private market investor, they tactically the in-depth of the long term, you want to ensure that there for the long term. And you also want to make sure that if they need liquidity at some stage, they can find or we can help them find somebody else, and that’s what we did. And that then triggers a realization of some of our carry both for us and for the managers. The second one is different in the sense that the clients themselves wanted us to restructure the fund so that we can adapt it to what they want to do. And again, we kept the management of it. So the first key point is that we have control of the management of both.
