How to start a private equity fund to make money

Private equity fund is a collective investment plan used for various equity investments and private placement of securities according to one of the related investment strategies. The following is how to start a private equity fund collected by Xiaobian. Welcome to read and share. I hope you will like it.

how to start a private equity fund

first, private equity funds raise funds in a non-public way. In the United States, Public Offering of Fund, such as Tong Fund and Pension Fund, generally advertise through the public media to attract customers, while according to the relevant regulations, private equity funds are not allowed to use any media to advertise, and their participants mainly join through the so-called "reliable information on investment" or directly know the fund managers.

Secondly, in terms of fundraising targets, the target of private equity funds is only a few specific investors, and the circle is small but not low. For example, in the United States, hedge funds have very strict regulations on participants: if they participate in the name of individuals, their annual income in the last two years will be at least 2, US dollars; If you participate in the name of the family, the family's income in the past two years is at least 3, US dollars; If you participate in the name of an institution, its net assets are at least 1 million dollars, and there are corresponding restrictions on the number of participants. Therefore, private equity funds have strong investment objectives, which are more like investment service products tailored for middle-class investors.

Third, unlike the strict information disclosure requirements in Public Offering of Fund, the requirements of private equity funds in this respect are much lower, and the government supervision is also relatively loose, so the investment of private equity funds is more concealed, the operation is more flexible, and the chances of obtaining high returns are greater accordingly.

In addition, a notable feature of private equity funds is that fund sponsors and managers must invest their own funds into fund management companies, and the success of fund operation is closely related to their own interests. Judging from the current international practice, fund managers generally hold 3%-5% of the shares of the fund. Once losses occur, the shares owned by the managers will be used to pay the participants first. Therefore, the promoters, managers and funds of private equity funds are as close as lips and teeth, and the interests of honor and disgrace and * * * * are the same body, which also solves the inherent weakness of managers' interests and insufficient incentive mechanism in Public Offering of Fund to some extent.

when can I buy a fund

it is most appropriate for the fund to buy near 15: on the trading day. The trading hours of the fund are 9: -11: 3 am and 13: -15: am from Monday to Friday, and cannot be traded on Saturdays, Sundays and national legal holidays. Fund trading is a kind of circulation and transfer activity with funds as the buying and selling object and self-bearing risk and income. Buying, including subscription, subscription, fixed investment, etc.; Selling includes redemption, liquidation, etc.

according to whether fund units can be increased or redeemed, they can be divided into open-end funds and closed-end funds. Open-end funds are not traded on the market (it depends on the situation), and the fund size is not fixed through subscription and redemption by banks, brokers and fund companies; Closed-end funds have a fixed duration, generally listed and traded in securities exchanges, and investors buy and sell fund units through the secondary market. According to different investment objects, it can be divided into stock funds, bond funds, money market funds and futures funds. Subscription refers to the process of investors buying fund shares during the period of raising open-end funds and when the funds have not been established. Usually, the subscription price is the face value of the fund share (1 yuan/share) plus certain sales expenses. Investors who subscribe for the fund shall fill in the subscription application form at the fund sales point and pay the subscription money.

How do novices start the fixed investment of funds

1. Make a good plan for funds.

first of all, investors must be clear: they must invest with idle funds, so they must make a good budget before starting to invest, and know how much idle funds they have to invest in the fund except for the necessary expenses.

2. Know what kind of fund is suitable for fixed investment

Remember the first principle of investment: don't vote if you don't know, and vote with confidence if you know. You must know the classification of funds before you start a fixed investment. Which fund is more suitable for fixed investment? Generally speaking, fixed fund investment and index fund are the best combination.

3. Where can I buy the fund

You can choose to buy the fund at the account opened by the securities firm or on the third-party trading platform, such as Alipay and Tiantian Fund. It is best to choose to buy in the venue, the handling fee is the lowest, and it is recommended not to buy in the bank, the handling fee is higher and the selection is less.

4. Setting investment target and time

The setting of investment target should be based on everyone's actual situation, and there is no uniform standard. It is suggested that 6% of idle funds be used for fixed investment of the fund. As for the investment time, the advantages of the fund's fixed investment can be better manifested through long-term investment. It is recommended to make long-term plans, generally it is best to be about 3-5 years.

once you start a fixed investment in the fund, you must stick to it. You can't stop the fixed investment because of a temporary decline, or even buy more and more.

Can closed-end funds be redeemed in advance?

Closed-end funds can't be redeemed in advance. Generally, closed-end funds have a term, for example, the closed-end period will be stated in the fund details, such as six months, one year, three years, two years, etc. Only when it expires can they be withdrawn. However, it should be noted that some closed-end funds will be listed and traded on the market, so that they can be sold in the secondary market.

Generally, a closed-end fund will not have a redemption page before it expires, that is, there is no way to redeem it. Therefore, when you buy a closed-end fund, you should make a good plan of funds, preferably a closed-end fund that will keep unused money for as long as possible.

If the money is needed in a short period of time, then you can consider an open-end fund, that is, a fund with no time limit. Generally, it will arrive in a few days, and when it is needed, you can redeem it a few days in advance.

will the fund return to its capital if it doesn't cover its position?

whether the fund will return to its capital depends on the increase of the fund. For a simple example, if the fund purchased by an investor loses 2%, it won't be able to return to its capital if it doesn't cover its position, but it needs to increase by 25%.

because the calculation formula of rising cost recovery is: rising cost recovery range =1/(1- loss range) -1, that is to say, when the investor loses 2%, the rising cost recovery range =1/(1-2%)-1=25%, so when the fund purchased by the investor loses 2%, it needs to rise by 25% to recover its capital.

Therefore, if the fund does not make up its position, it can return to its capital as long as the increase is relatively high. However, if the fund loses heavily, it will be more difficult to return to its capital without making up its position. Therefore, when buying the fund, you should set a stop loss point to avoid the fund losing too much.