Greetings, and welcome to the WisdomTree Second Quarter 2025 Earnings Call. As a reminder, this conference is being recorded. It is now my pleasure to introduce Jessica Zaloom, Head of Corporate Communications. Please go ahead.

Good afternoon. Before we begin, I would like to reference our legal disclaimer available in today's presentation. This presentation may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements about our ability to achieve our financial and business plans, goals and objectives, and drive stockholder value, including with respect to our ability to successfully implement our strategic goals relating to our acquisition of Ceres Partners. A number of factors could cause actual results to differ materially from the results discussed in forward-looking statements, including, but not limited to, the risks set forth in this presentation in the Risk Factors section of WisdomTree's annual report on Form 10-K for the year ended December 31, 2024, and in subsequent reports filed with or furnished to the Securities and Exchange Commission. WisdomTree assumes no duty and does not undertake to update any forward-looking statements. Now it is my pleasure to turn the call over to WisdomTree's CEO, Jonathan Steinberg.

Thank you, Jessica. Thank you, everyone, for joining us today. Before we go through our second quarter results, I wanted to begin by discussing our recently announced acquisition of Ceres Partners. On our earnings call six months ago, we said we were looking to deploy capital in a way that is accretive, accelerates growth, and gives us exposure to private markets. We've been disciplined and deliberate in that effort. And today, we're delivering on exactly what we said we would do. Last night, we announced that WisdomTree is acquiring Ceres Partners, a leading U.S. farmland investment manager. This transaction adds real strength to our business today and even more potential over the long term. Ceres expands our platform in a way that's accretive, strategic, and highly aligned with where we see the future of asset management heading. While others are paying up for private credit platforms, we focused on opportunities that fit our strengths. This is a business where our institutional expertise and distribution capabilities can make a meaningful impact going forward, where we can help drive the next stage of growth. Looking at the numbers, this is an accretive transaction that accelerates both revenue growth and our margins. By 2030, we expect to raise at least $750 million into farmland-focused strategies, which would more than double Ceres' current base and performance fee revenues. WisdomTree has long been levered to ETFs and models and is a pioneer in tokenization with our efforts over the past five years. This acquisition adds another secular tailwind to our platform, private markets, and specifically, U.S. farmland, which we believe is one of the most stable and underpenetrated asset classes in all of asset management. Let me explain why this team is the right partner and why the farmland category is such a compelling opportunity. Ceres is the premier partner to the American farmer. They are among the top five U.S. farmland managers with nearly $2 billion of farmland and have delivered 10.3% net returns for investors since inception. They bring deep operational expertise and a differentiated footprint in the upper Midwest, where water is abundant and agricultural fundamentals are strong. Importantly, they operate in a $3.5 trillion market that is highly fragmented and largely under-institutionalized. There is minimal competition from major asset managers and we see a real opportunity to scale. We believe WisdomTree's institutional capabilities across distribution, product structuring, and technology can help bring farmland investing to a much broader base of clients, and we see a credible path to managing $10 billion in farmland assets 10 years from now. Let's dig into the characteristics of farmland as an asset class. If you turn to Slide 5, you'll see a 20-year risk/return comparison across asset classes. Farmland delivers equity-like total returns, approximately 10% per year with significantly less volatility. These returns are driven by both appreciation and a strong income component with unlevered rental yields between 4% and 5%. What's more? Farmland has powerful diversification characteristics. As the lower left chart shows, returns are negatively correlated with equities and other traditional asset classes while being positively correlated with inflation. That makes farmland not just a performance play, but also a tool for risk mitigation and inflation protection. Now let's turn to Slide 6 and see how this plays out in real-world scenarios. This slide shows farmland's performance during three major extended equity drawdowns: The 2000 technology bust, the 2008 financial crisis, and the 2022 rate hiking cycle. While equities declined between 18% to 46% during those drawdowns, farmland returned positively between 17% and nearly 30%. That's a dramatic difference, and it makes a strong case for adding this uncorrelated asset to more portfolios. We believe many of our existing clients will be interested in this exposure, and we're evaluating various ways to bring it to them, potentially even including farmland as an allocation in our model portfolios. Now if we flip to Slide 7, I want to spend a moment on Ceres' performance and what sets them apart. Even before you factor in any optionality from solar, AI data centers, or water, Ceres consistently outperforms the broader farmland benchmark. Their strategy is focused and disciplined, targeting high-quality row crops and specialty farmland primarily in the upper Midwest, where water availability supports durable yields. This thoughtful, data-driven approach has resulted in net returns of 10.3% since inception and above the national crop land index during all time periods. And on top of the strong core, they've developed strategic overlays that can further enhance returns. First, solar. Ceres has a tactical overlay strategy where they write solar lease options on qualifying farmland. These contracts alone can double rental income and to fully exercise can either generate 5x rental income or support high multiple sales of the properties. Second, AI data centers. Certain properties have been acquired by developers building data centers to support AI infrastructure, generating 10x returns in isolated cases. These are lower probability, but high upside events that add attractive optionality to the investment profile. Finally, water rights. Ceres is actively exploring water management opportunities in drier regions like the Colorado River Basin. It's still early here, but we think this initiative could become increasingly relevant in a resource-constrained future driving even faster growth. So to summarize. With this acquisition, we're entering a resilient income-generating asset class that complements our existing platform and opens up the door to long-term growth. It diversifies our revenue, supports our operating margins, and gives us new ways to serve clients. We're excited about the path ahead. With that, let me hand the call over to Bryan and Jarrett to walk you through the deal structure, our growth targets, and our second quarter results; then we'll take all your questions. Thank you.

Thank you, Jono. I'm going to spend a few moments covering the deal terms, accretion, and long-term growth targets. Consideration paid for this acquisition includes $275 million upfront in cash. Consideration also includes an earnout payable in the year 2030 of up to $225 million, contingent on achieving a 5-year revenue compound annual growth rate (CAGR) of 12% to 22% during the earn-out measurement period of January 1, 2025, through December 31, 2029. No earn-out is payable if revenue growth is less than 12%, and the earn-out is capped at $225 million upon achieving 22% revenue growth or more. Next slide. We expect this acquisition will immediately increase our fee capture and expand our operating margins. Although we can give no assurance to the nature of our financing and related terms, we have included an illustrative accretion analysis, assuming the acquisition is debt financed. This analysis also highlights operating margin expansion of over 200 basis points and revenue capture increases from 38 basis points to 41. The information on this slide is for illustrative purposes only as the underlying assumptions may not ultimately materialize. Next slide. As we look forward, we are targeting $750 million of organic assets under management (AUM) into farmland-based strategies over the next five years, which would double our base fee revenues in 2030 from current levels. Performance fees are predicated on performance and are highly correlated to the mark-to-market of the overall farmland portfolio. Long-term farmland returns have demonstrated appreciation of approximately 6%, implying at least 1.5x to 2x growth in performance fees over the next five years. We anticipate this acquisition closing in the fourth quarter. That covers our prepared remarks over this pending acquisition. Now turning our attention to our second quarter results. Next slide. We are delivering strong sustainable momentum, generating $6.6 billion of inflows year-to-date through June. Flows are broad and diverse, spanning regions, asset classes, and strategies. We've generated approximately $3 billion into our U.S. listed products, $3.3 billion into our European products, and more than $300 million in digital assets, and we are capturing interest across our international equity, U.S. equity, and fixed income strategies. Our European Defense Fund, with AUM of approximately $3.5 billion, continues to outperform, attracting nearly $2.1 billion of flows in the quarter and over $2.8 billion year-to-date. This cross-asset, cross-regional momentum is driving organic growth at an annualized rate of 12%. Combined with favorable market conditions, these inflows have propelled their AUM to a record high of $126 billion at June 30, with U.S.-listed AUM at $85.2 billion and Europe at $40.5 billion, both all-time highs. AUM in digital assets has more than doubled since last quarter, reaching $350 million at June 30 and approximately $500 million today. Our business is operating from a position of strength, marked by record AUM, robust inflows, and consistent growth across all regions. Next slide. Revenues were $112.6 million during the quarter, an increase of 4.2% from the first quarter and up approximately 5.2% versus the prior year quarter, driven by higher average AUM. On a year-to-date basis, our revenues have grown 8.3% driven by higher average AUM and higher other revenues attributable to our European listed products, partly offset by a lower average fee capture. Our adjusted net income for the quarter was $25.9 million or $0.18 per share. Our adjusted net income excludes $2 million of acquisition-related costs and other miscellaneous items. Next slide. Now a few comments on our forecasted guidance. Our strong organic growth, including the recent success of our European Defense Fund and AUM expansion across our distribution platforms, has led us to update our third-party distribution guidance to range from $14 million to $15 million. We are also monitoring foreign exchange headwinds to our expense guidance as expenses of our international business are denominated primarily in euros and pound sterling. If today's exchange rates hold during the remainder of the year, it would have an adverse impact on our discretionary expense guidance by approximately $3 million. This item is offset by incremental revenues earned on foreign-denominated advisory fees and other revenues such that the overall impact of foreign exchange on our overall net operating results is immaterial. Our weighted average diluted shares were $146.6 million during the second quarter. There are no incremental shares associated with our convertible notes as our average stock price during the period was less than the conversion price of our notes. An illustration is included within the appendix to our earnings presentation to disclose the impact of incremental shares related to our convertible notes at today's stock price. With respect to the pending Ceres acquisition, our overall expense guidance for the year remains largely unchanged. The illustrative accretion analysis included in our materials offers a framework for updating your models to reflect the potential impact of the transaction. Looking ahead, we remain focused on accretive capital deployment opportunities, including share repurchases and other strategic initiatives. That's all I have. I will now turn the call over to Jarrett.

All right. Thank you, Bryan, and hi, everyone. At the start of the year, we laid out a vibrant vision, one that was ambitious but grounded in discipline and focused on delivering differentiated value across our business. Now midway through 2025, and we can confidently say we're not just tracking to that vision, we're outperforming it. This quarter, we hit on every cylinder of our growth engine. We posted record AUM across the U.S., Europe, and digital assets, fueled by more than $6.5 billion in net inflows in just the first half of the year. And these flows weren't concentrated. They were broad and diverse with the U.S., Europe, and digital all contributing, and we're now fully focused on carrying that momentum forward into the second half. And a big driver of that momentum is Europe, where we're leaning into opportunity with conviction. Our WisdomTree Europe Defense Fund, which was launched in March, has already brought in more than $3.5 billion in assets, and it's one of the strongest launches in our history and one we expect will continue to scale. And we're not stopping there. We've expanded the European defense team to the U.S. market, and we are adding additional strategies to help investors capture global political risk themes. And that's what execution looks like, early identification, smart design, and strong distribution. In Q2, we also announced a strategic investment in Quorus. This partnership gives us greater exposure to direct indexing, which is one of the fastest-growing segments in asset and wealth management. We believe this move will accelerate our growth in other revenue and deepen our edge in the model portfolio space. And speaking of models, we've already exceeded our 2025 full-year assets under administration (AUA) target with more than $5.2 billion in AUA. We're also on track to hit our adviser growth target as well, now with more than 2,800 advisers using our models. Looking ahead, we'll use our Quorus relationship to make it even easier for advisers and broker-dealers to adopt our models with no additional technology trading or rebalancing costs, solving a pain point and unlocking sustainable, scalable growth. Let's now turn to digital assets, where we're seeing meaningful traction. AUM grew to $350 million at quarter-end and now stands over $500 million today, driven primarily by institutional flows through our Connect platform, and we're now working with 10 unique clients and our pipeline continues to grow. Prime is also progressing, and we just received approval to operate in Texas and now only have Virginia left before we have full countrywide coverage. Our on-chain transfer capabilities launched this fall represent a major milestone that unlocks new use cases and deepens our product utility. Like in ETFs, we know the playbook: grow clients, grow wallet share, and scale with discipline. Now we've also been getting a lot of questions about our stablecoin strategy, especially with Circle's IPO and the GENIUS Act in the news. So here is our take. The stablecoin market is projected to grow from $250 billion today to $3.7 trillion by 2030, and we don't see any scenario where that market grows by more than 10x and WisdomTree doesn't meaningfully benefit. Our stablecoin strategy is built on two products: USDW and WTGXX. USDW is a purpose-built stablecoin issued by our New York Chartered Trust Company. It powers tokenized investing in Prime and is designed from the ground up for real-world finance, not just crypto trading, and it will expand across platforms and chains, reflecting our chain-agnostic infrastructure. One of USDW's key advantages is structural. Because our customers receive distributions in USDW, AUM doesn't decline with every dividend or interest payment, giving us a persistent asset base and a powerful structural edge over traditional ETFs. As more assets move into USDW, we earn net interest income on held balances, creating another scalable revenue stream. WTGXX is our '40 Act money market fund and acts like a yield-bearing stablecoin. It's already being used as a reserve asset by other stablecoin issuers and as a yield solution in on-chain treasury workflows. Importantly, it's interoperable, live today across six different blockchains with seamless functionality across ecosystems. By owning the infrastructure across issuance, reserves, and treasury tools, and by being chain-agnostic from day one, we've built a unified platform that's ready to scale with the digital economy. Now we've often said we're underrecognized, but that's beginning to change. In 2025, we've received some major honors. Fortune ranked us as one of America's most innovative companies, number 58 overall; number 2 in process innovation; number 3 in culture. FTF News named us one of the best digital asset processing solutions. Our India hedge fund was named Best New International Equity ETF by etf.com, and we were named Best ETF provider in Europe from the online money awards. These awards matter. They validate our approach, which is innovation-led, infrastructure-driven, and client-centered. And now with Ceres joining the fold, we add even more horsepower to our growth engine, opening up exposure to the structural tailwinds in private markets and further enhancing our asset mix and earnings power. So to wrap it up, these are foundational wins, and we're building a platform for continued momentum, greater impact, and sustained outperformance. We said in February what 2025 would look like, and here we are delivering on every front. And with that, we will now open it up for questions.

Our first question is from Chris Kotowski with Oppenheimer & Company.

Yes. A question about Ceres. First of all, I'm wondering about where they raise funds from and the fund structure? Are they institutional drawdown funds or retail evergreen vehicles? And can you talk a little bit about the fundraising plans for the future?

Certainly. Thank you for your question. So first of all, let me just say that with this acquisition, we're taking all of the employees of Ceres, 24 people. It's a tremendously easy integration. And what we're really doing is integrating their investment engine, their prowess in investing, and tying it to our distribution. But in terms of their clients, Jeremy Schwartz, would you answer? I think it would be best coming from you.

Sure. Happy to. And I think you mentioned the evergreen or the traditional drawdown fund; it's a combination. It's an evergreen fund. So it's not a drawdown fund. It was meant to be the real partner for the farmers. And if you were having to sell the farms every time you're distributing your traditional private equity fund, you wouldn't be a great partner. So they were forward-looking in setting up this evergreen structure. Their client base is really a cross-section similar to our client base in the way. So institutions, RIAs, advisers. I think we have a strong distribution team that will help them raise capital, and this is a nice diversifying asset class for our traditional client base as well.

Okay. And then as a follow-up, I'm looking at Slide 10, the accretion example. And looking at the Ceres' P&L, it looks like a significant amount of their revenues come from performance fees. So I wonder if you could talk a bit about how durable, consistent, and predictable those are?

Bryan, can you take this?

Yes. I'll take this one. Chris, thanks for the question. The performance fees will largely be driven by the underlying mark on the farmland portfolio, but let's walk through the economics of the fund itself because the performance fees are computed on the fund's bottom line. If you think about the fund, it owns roughly 540 properties. Those properties are leased to farmers, and those leases are generating a steady stream of rental income, 4% yields on average. That's rental income that is recognized by the fund, and it's fairly steady. The fund will also benefit from marking to market the overall farmland portfolio. So there's roughly $1.8 billion of AUM today. That's largely the valuation of the 540 properties. Make your own estimates about market appreciation, but in the long term, farmland has appreciated at roughly 6% on average and has had only 9 down years since World War II. If you take a 6% average mark on $1.8 billion, that's the unrealized gain recognized by the fund, and it's a meaningful number. You have the rental income and you have the unrealized recognized by the fund, then deduct the fund-related expenses and the management fee, and that's what gets you to the net profits of the fund, which serves as the basis for the performance fee. The performance fees are not episodic; you don't need to recognize or it doesn't require asset realizations. They're earned on the net profits of the fund, and it's largely driven by the mark. The rental income earned by the fund generates sufficient cash to pay the performance fees. We just walked through didn't touch upon the embedded optionality in the portfolio regarding solar and AI data centers, as mentioned in Jono's prepared remarks. About 1/3 of the farmland is under solar lease option. If those options are exercised, the farm generating 4% yields on average is converted to solar, and those solar farms will boost the rental income 3x to 5x compared to what the farm had been generating. That's incremental upside. The data centers also serve as a real opportunity; data centers could attract valuations 10x the current mark of a farm, meaning selling a farm in the portfolio at 10x today's value. Again, that's additional incremental upside. The performance fee will ebb and flow depending on the market environment. But again, we're talking about an asset class with price returns of 6% on average and only 9 down years since World War II. The asset class contains embedded upside when considering the solar and AI data center opportunities. Hopefully, that helps clarify things.

Yes. And just the evergreen fund structure, is it like what we see from some of the other alternative asset managers where you're investing in illiquid assets? Therefore, there are typical limits on withdrawals? Is it similar structure to that?

Jeremy Schwartz, can you confirm for me, it's an annual withdrawal, right?

Yes, that's my understanding as well.

I was particularly compelled with the theme that very few of the large asset managers are in this farmland space. And you mentioned that you may add this to your model portfolios. I'm wondering why you wouldn't do that given the competitive opportunity?

Thank you for that. No. So I think that we will look for opportunities like adding them to our models, maybe even adding a sleeve into selected ETFs where it would be appropriate. It is such an attractive asset class; I think it's underappreciated in the world. To your point about not having to compete with the Blackstones and the BlackRocks of the world, it really is pretty extraordinary that a $3.5 trillion market that is so highly fragmented with such attractive return potentials. We're really finding that we're competing with the Mormon Church, who are the largest owner of farmland. Bill Gates and some of his entities make up the second-largest investor. We are the fifth-largest investor. We're really coming at this with real scale, and I think it's really poised this platform to grow even faster. Thank you for that question.

So I'm curious with respect to the models. It's great to hear that you've hit your goals for the year there. I don't believe you updated your goals for the year. I'm just curious what the expectation is for the models business for the rest of the year?

Jarrett?

Yes. Our goal has just been a lot of blocking and tackling there, and what we've talked about is to get new users using the models and then get existing users to use either more models or use the models more. That's been the focus. We set out goals at the beginning of the year. We're on track in terms of number of users. But actually, that compounding effect of getting new people on and existing people to do more has been even better than we thought, and that's where it's driven that above-target result. For the rest of the year, it's just to continue the progress, just keep pounding away continued execution. We'll think about it. Generally speaking, that was a departure for us by giving that kind of target. Historically, we provided expense guidance, but we don't provide revenue guidance. We leave that to you. This was an exception because we wanted to show our confidence. Right now, we're not updating any of those forward-looking thoughts. Our expectation, as I said, is to continue to grow, continue to execute, and continue doing what I've said: get new users and engage further with existing users.

One other question, and congratulations on the approval from the Great State of Texas. You've been fairly quiet in your marketing, although you're well ahead of the market in terms of WisdomTree Prime. What does this mean for your ultimate event-type marketing going forward?

Will Peck, our Head of Digital Assets. Could you answer this?

Yes, absolutely. So glad to be able to talk about our success in digital assets this year. I mean, we've been very proud of the AUM growth we've had. What Jarrett touched on with our overall stablecoin strategy is really seeing that play out with the AUM growth of WTGXX. So as we've talked about in the past, it wasn't really a focus of the first half of the year to grow WisdomTree Prime accounts. It's really been about growing AUM, expanding our functionality, and getting approvals. We're well on our way. We've certainly done a lot of AUM growth. Like I said, we've added functionality. We've got approvals in Texas, which sets us up very well with a couple more things to start expanding marketing in the fall. I wouldn't really say it's one big marketing event, right? We want to be very prudent with shareholder capital. But I think we've got a great plan leaning into on-chain transfers, the overall growth in the stablecoin ecosystem, which is truly one of the stories of financial services this summer, and by leaning into that in the fall and growing accounts well from there.

On the Ceres acquisition, I was hoping you could elaborate a bit on how you plan to help accelerate the growth of that property and the steps you'll be looking to take? If you could just elaborate a bit on the profitability of the management fees, what that looks like versus the profitability on the performance fees and how you expect the management fee growth of Ceres to evolve over the next couple of years? What sort of growth rate are you anticipating there?

So let me take the first part on how we plan on accelerating their flows. As I said, this is a very easy integration. Ceres is a 24-person team, and we're taking all 24 people, and we have this 5-year earnout, so we're completely aligned. So that's very, very easy. Really for the last 17 to 20 years, Ceres has been focused on building their investment prowess, executing acquisition farmland by farmland, building that network, and they've proven to be the best investors in the space. We think that our distribution, particularly in the United States, our 50-plus person team will be very constructive in bringing their investment prowess to a much broader financial intermediary, family office, and high net worth teams. We should find that we're going to be very successful in generating interest and ultimately flows into the asset class. Now we said that we expect to at least take $750 million over the next five years. If you look out to 10 years, I will not be surprised if we're managing $10 billion in farmland. So it feels like 1 plus 1 equals 3 on this particular acquisition. Jarrett, would you like to add something?

Yes. Just one thing. If we look back at when we acquired ETF Securities in Europe, one of the benefits we saw there was the established distribution pipes that came with that acquisition. In a similar way here, when we combine ourselves with Ceres, we are the ones with the established distribution pipes that are leverageable, and that will be a big part of the growth too. This is, as we've been describing, a unique, differentiated but very attractive asset class, and we believe our current distribution or our clients will have a great interest. We do believe we can help scale them very quickly.

And Bryan, could you answer the second part of this question regarding the performance fees?

Yes, I think so. Mike, tell me if I'm not answering your question. Some of this goes back to our prepared remarks. If you think about it this way, our target of $750 million of organic AUM over the next five years would double our base fee revenues in 2030 from what we're seeing today. When we think about the performance fee, if you assume the rate of return or the price appreciation on farmland is what history has shown to be roughly 6% on average, if you have a 6% mark on the farmland portfolio and $750 million of organic AUM over those five years, the performance fee will increase from where it is today; it will experience 1.5x to 2x growth. As it relates to the profitability of one revenue stream versus the other, we don't think about it that way. Our guidance, when we think about our guidance and think about WisdomTree as a whole, our compensation ratio is 28% to 30%. This acquisition doesn't change that guidance in any meaningful way, and their non-comp expenses are immaterial in the grand scheme of things. So I think that should help clarify things.

Great. That's helpful. And then just a follow-up question, if I could, just on the digital asset side. I think on stablecoins, you mentioned could be a $3.7 trillion marketplace by 2030, hoping you could elaborate on what you see unlocking that magnitude of growth? How much do you anticipate migrating from money funds to stablecoin versus other drivers of growth? And then just more broadly on your stablecoin and digital asset initiatives. Can you elaborate on the traction you're seeing? What are some of the hurdles that you're trying to navigate to drive wider adoption? And what might be the big unlock as you look out from here?

Will?

Yes, happy to take that question. So that forecast actually came from the Treasury Secretary in terms of what the stablecoin market could be, $3.5 trillion or something within the decade. Stablecoins are $260 billion today; that's up, I think, something like $60 billion year-to-date. We see post-GENIUS Act just incredible adoption from here. One use case I like to give is corporates doing cross-border payments, right? Treasury management for large corporates is a very complicated process. Stablecoins can simplify that, allowing for transactions that don't lose money when sending overseas for weeks. They can complete transactions instantly, with very low fees on-chain. WisdomTree is well positioned for that. If you look at the U.S. money supply today, yielding instruments are approximately 3x the size of demand deposits, so stablecoins can be a $3.5 trillion market. We're talking about tokenized money market funds being a $10 billion market if things play out that way. I think we've got the best '40 Act tokenized fund—money market fund—in the market today. We certainly had the most growth over the past three months based on some market statistics. I believe WisdomTree is incredibly well positioned. I view this as a bit of a land-grab moment, and we're in conversations with other stablecoin issuers, tech platforms, and corporates for traditional finance use cases. I wouldn't really say there are big inhibitors right now. We're working through some of the final regulatory aspects. There's some new functionality related to exemptive relief that we're looking to get, and I'm incredibly excited about it. I think it's a huge opportunity for us.

First question, just on the acquisition. You talked about your distribution and your current pipes. Which end customer market do you think you're going to go to first, the RIA channel, the institutional market, family offices? Which one do you think is best positioned for this farmland opportunity?

Jeremy, you want to take it? I mean, I can, but you want to?

Sure. I wanted to add a little bit of context on just the market outlook for the markets and how this fits in and why I do think the RIA is the answer on this one for where the models can deliver it and how we think about it. From a broad markets perspective, you have bonds yielding 4.25% on the 10-year and TIPS yielding 2%. So inflation-adjusted bonds provide about 2% income. Thinking about the return drivers, we said farmland delivered 10% historically, and you're trying to get 4% to 5% cash flow, that's an inflation-adjusted cash flow that's diversifying. We think this is a great long-term asset. The models team and custom models will be a big use case, and that is really the RIA and adviser. We'll continue to find other opportunities.

Great. Thank you.

Some of the questions have been around the acquisition. Is there any regulatory or other changes necessary in order to distribute the assets from Ceres to customers to help grow it?

No, there is not.

Okay. And then, this being private assets, with approximately 540 farms, how is the mark-to-market done regularly? Is that a cost that's going to change under your ownership?

Bryan?

Yes, the process won't change. They will mark their farms every year. They will break it down, doing a quarter of the portfolio in the first quarter, a quarter in the second quarter, and so forth throughout the year. Their prospectus lays out their procedure with respect to their appraisers and the cadence they must use. They can't use an appraiser for more than three years in a row and have to change to another. Every property is appraised annually.

Got you. And I guess, last question, are you guys also taking the private equity part of the company as well? Any thoughts on that going forward?

Repeat that question, I'm sorry?

Yes, there are some other private equity investments they have or investments in some individual companies outside of farmland within Ceres Partners. Is that being acquired as well? Or is that not included?

Bryan?

It's not included; Ceres Partners will continue to manage it, but the economics will stay with the former sellers. One strategy that is PE-related is their water strategy, and that will fall under our roof, and we will retain the economics there. However, as it relates to the two funds, which have $20 million to $40 million of AUM within those two PE funds, the economics don't stay with us.

Thank you. There are no further questions at this time. I'd like to hand the floor back over to management for any closing comments.

So just a closing thought here. When I was launching WisdomTree, my pitch to the fantastic Michael Steinhardt, the incredible Jeremy Siegel, and the legendary Jim Robinson was I thought I knew how to thrive in a Vanguard world, recognizing the importance of after-fee, after-tax performance, recognizing the fee compression that the industry was facing and would continue to face in the coming decades. At WisdomTree, we did that by embracing the ETF wrapper before Vanguard and other traditional asset managers got serious about ETFs. We used proprietary self-indexing strategies and active funds, so we weren't competing solely on commoditized exposures. Today, another way to thrive in a Vanguard world is to invest where there is no beta. And in farmland, there is no beta. Plus, we are buying the best farmland investing in the market. Ceres is the best investor in this asset class. We are embracing this acquisition, and we could not be more proud to be entering this space. We will be in this space for as long as we are in asset management, and we look forward in the coming quarters to giving you updates on our progress. Thank you for joining us on this call.

This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.