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Alternative Asset Manager Takeaways Within alternative asset management, four of the public managers, ARES, BX, CG, and KKR presented, while the others did meetings. During the conference we polled the audience on several key topics including the outlook for the equity and real estate markets, potential impacts from the recent election, distribution outlook, and firm structures and business models. Investors were generally bullish on the equity market, potential for fiscal stimulus ahead, and a key focus from investors was on the potential change in taxes following the election, and whether that means reassessing corporate structures for the alts, with a possible change from PTP to C-corp. Investors bullish on the equity markets Our polling results indicate that investors are generally positive on equity market returns over the next year. When asked “What is your expectation for equity market returns over the next year?” the most common response was +0-10% (51%), followed by 10%+ (25%), 0 to -10% (15%), and <-10% (8%). Chart 10: What is your expectation for equity market returns over the next year? 60% 50% 40% 30% 20% 10% 0% 10%+ 0 to +10% 0 to -10% More than a 10% pullback Source: BofA Merrill Lynch Global Research Investors are less positive on the real estate market When asked “Where do you think we are in the overall Real Estate cycle?” most people think that we are in the middle innings with a few pockets of concern (57%), followed closely by later innings with growing areas of concern (42%). Very few people think that we are in the early innings of the real estate cycle (1%). Bankof America 2 2016 Future of Financials Conference | 17 November 2016 7 Merrill Lynch HOUSE_OVERSIGHT_014321