Zeynep Ton, CFA, is a portfolio manager at a private equity institutional investor. She is considering an investment in a buyout fund to achieve better diversification for her firm$$s private equity portfolio. She has narrowed her choices down to two funds that she sees as having similar risk$-$return profiles. Before deciding which one to invest in$,$ she compares the terms of each fund.

Fener Fund

Besiktas Fund

Management fees

$1\%$

$2\%$

Transaction fees

$50-50\%$ split

$5050\%$ split

Carried interest

$20\%$

$15\%$

Hurdle rate

$8\%$

None

Clawback provision

Yes

No

Distribution waterfall

Total Return

On a deal$-$by$-$deal basis

Based on the analysis of terms, which fund would you recommend to Ton? In other words, which fund serves the interests of Limited Partners better?