As the name implies, private equity funds correspond to "public offering". Public Offering of Fund is a common open-end or closed-end fund in our life. In the face of public offering, the starting point of domestic entry is generally 1 1,000 yuan or 1 1,000 yuan. Private placement belongs to "rich people" funds, and the starting point for entry is relatively high. In China, the starting point is generally 500,000, 1 10,000 or even higher, and the number of fund holders is generally no more than 200. Large private placements are often raised through trust companies, and it is difficult for ordinary investors to join. Private equity institutions that always hide behind the scenes are undoubtedly the most dazzling stars in the investment and wealth management market, and their investment performance is generally higher than that of funds. In contrast, it is simply not worth mentioning that funds and brokers collect wealth management. As one of the most sensitive capital groups in the market, private hot money has great appeal in the market. Precision, profiteering and mystery are synonymous with private placement. Second, how do private equity companies make money?

First, Public Offering of Fund's main profit point is management fees. However, because the interests of the fund team and investors are tied together, the main profit point of private equity funds lies in the positive returns of the funds themselves. So for private placement, there is an absolute positive return.

Second, fund companies take your money and other people's money, go to stocks, buy bonds, invest, and do things that can make money in the financial field, including some deposits in banks. In fact, in the stock and bond industry, a group of experts help you do what you can. Due to market fluctuations, funds will also rise and fall. Not all of them always make money! But after all, experts are more experienced than us, and the operation is less risky than our own stock trading!

Third, what kind of private placement will make money?

1, with necessary scale.

Private equity companies can only support themselves if they reach a certain scale. The above statistics also show that more than 95% of the private equity management scale is less than 654.38+0 billion yuan, most of which are less than 500 million yuan. Under the formula of "company profit = scale * income", high management scale is an important factor for private equity companies to survive and maintain basic operations in a weak market. According to relevant statistics, the assets managed by private equity institutions widely recognized in the market are more than 3 billion yuan. Steady performance and suitable high scale make these large private equity investments more calm and form a virtuous circle of scale and performance.

2, should look at the performance of the company's existing products.

Private placement with good performance in the past and relatively stable retreat all show that fund managers have the ability to obtain stable and sustained returns for investors. In addition, according to previous statistics and observations, private placement products have a magical performance explosion line. Private fund managers will be cautious in operating style and conservative in position control and stock selection before accumulating enough "safety mats". Once enough "safety mats" are accumulated, their style will become relatively positive, and this time point is often the starting point for the performance of private equity products.

These are all how private equity companies make money. Private equity fund companies must have the necessary scale and team to make money.