Sophisticated investment funds
On September 30, 2009 in Finance
Investment funds that wish to take on client funds are required to comply with stringent regulatory requirements.
For funds that target high net-worth investors can have less regulatory restrictions if they limit to only allow sophisticated investors. These investments may free from regulations that usually cover leverage, fee structures and liquidity requirements.
A sophisticated investor is required provide the required documentation from an accountant that they meet the criteria.
Typically this restriction is that the investor has:
(i) Net worth of at least $2,500,000; or
(ii) A gross income for each of the previous two financial years of at least $250,000/yr.
Being a sophisticated investor allow you the ability to invest in funds that you would otherwise have been disqualified from.