Understanding Form PF

Form PF is an SEC rule that requires investment advisers who manage private funds to report risk exposure statistics consistently. This is only required for those with private funds more than $150 million in assets in assets under management and venture capital funds.

The frequency of reporting depends on the size of the reporting advisers. Advisers with more than $1.5 billion in gross assets under management attributable to hedge funds are subject to detailed quarterly reporting. Advisers with more than $1.0 billion in gross assets under management attributable to private liquidity funds and registered money market funds are also subject to quarterly reporting. Reporting advisers with more than $2.0 billion in gross assets under management attributable to private equity funds will only be subject to reporting annually.

This form requires detailed information on liquidity funds, private funds, hedge funds. There are general guidelines that apply to each kind of fund. Liquidity funds seek to generate income by investing in short-term securities.

Hedge funds are generally defined as private funds that are able to earn performance fees on unrealized gains, permitted to borrow in excess of one-half of net asset value, permitted to have gross notional exposure in excess of twice net asset value, or permitted to sell securities. Hedge funds face fewer regulations than mutual funds. Private equity are funds that are not listed on a public exchange.

 Form PF must be filed electronically through the Investment Adviser Registration Depository (IARD) website. The fees charged by FINRA to use IARD are $150 for each annual report and $150 for each quarterly report.

Here is a link to the PDF version of Form PF on the SEC website along with a link to their FAQ on Form PF.