What Is an Investment Company?
An investment company is a business that pools money from investors and invests it in securities. The company then splits the profits and losses between all of its investors. The typical investment company structure is a partnership or limited liability company with investors having varying degrees of interest in the company. These investment vehicles are regulated by the Securities and Exchange Commission.
What should you not invest in?
Investment companies have been around since the 1920s, but they were not formally recognized until the 1940s. The early years of financial markets were marked by lack of information and market manipulation, so regulations were needed to protect the public. The Investment Company Act of 1940 regulated investment companies and defined the types of companies. Investment companies, like any other business, are subject to regulation and must register with the SEC.
Investment companies typically have a portfolio of diversified assets and employ an investment manager to manage it. The investment manager must adhere to the investment policy and objective of the fund. This means that the manager must always act in the best interests of fund shareholders. Investment companies are separate legal entities and operate under the supervision of their boards of directors. The series A funding round is led by Tiger Global Management.
The sale price of an investment company depends on its net asset value, or NAV. This value is calculated by subtracting the company’s liabilities from its assets and dividing it by the number of shares it has. The value of an investment company’s net assets may change daily, so investors should pay attention to this number.