The motivation of equity investment is 1. Earnings, including dividends and capital gains.
2. Gain control over assets and gain benefits through adjustment, scheduling and appreciation of assets.
3. Participate in business decision-making, spread risks and find business opportunities.
4, adjust the asset structure, increase the current assets, in the occasion of investing in tradable shares, this motivation often exists.
5, speculation, in order to obtain the bid-ask price difference, in the occasion of investing in tradable shares, this motivation often exists.
What are the types of equity investment? Equity investment is divided into the following four types:
1, the right of control refers to the right to decide the financial and business policies of an enterprise and obtain benefits from its business activities.
2, * * * * has control, refers to the control of an economic activity according to the contract.
3, significant influence, refers to the enterprise's financial and business policies have the power to participate in decision-making, but do not decide these policies.
4, no control, no * * * control and no significant impact.
The benefits of equity investment are low investment threshold. Since the development of China's capital market, individual investors can only invest in the secondary stock market, while the most profitable equity investment in the primary stock market is only enjoyed by a few institutional investors. But now this situation is gradually changing. Under the background of China government's determination to develop multi-level capital market, the threshold of equity investment has been greatly lowered. At present, only hundreds of thousands of enterprises can invest in the original equity, and individual investors can also get a share in the primary market.
The investment cycle is short. At present, the exit methods of equity investment are mainly divided into two categories, one is through listing in various capital markets at all levels, and the other is through repurchase by enterprises according to contracts. Compared with the investment cycle of institutional investors of 5- 10 years, the withdrawal cycle of individual investors' equity investment is generally around 1-2 years, which is shorter and more flexible.
Because the original equity with great return potential is generally unlisted, the price of equity is relatively low, and the valuation is cheaper than the share price of the same industry in the secondary market. This means that after listing, the share price may have several times of premium income, and the return potential is very great.
Investors who have a small risk coefficient of original equity will directly become shareholders of the company. Through industrial and commercial changes, investors will directly appear on the list of shareholders of the enterprise. From a legal point of view, investors will become the real shareholders of enterprises. As the preferred shareholders of the company, investors enjoy the agreed dividends every year. Before individual investors withdraw through listing, merger, transfer, etc. Priority shareholders will enjoy the company's dividends first.
Venture capital decision-making of equity investment The risks of venture capital decision-making are mainly reflected in inaccurate project positioning and omissions in decision-making procedures. Each project has a specific industry, and investors do not understand the industry, industry cycle and market environment where the project is located, which will cause industry positioning risks. Incomplete understanding of the technical level and production capacity of the project enterprise and inaccurate positioning of the development stage of the invested enterprise will lead to the risk of investment type selection.
Enterprise management risk Enterprise management risk mainly refers to the management risk of the invested enterprise. The risk may be caused by changes in the market environment of the industry where the project is located, mistakes in business decision-making, insufficient ability of enterprise managers, or unstable management team. Changes in business conditions can easily lead to adverse situations such as performance decline, shutdown and bankruptcy. , thus affecting the withdrawal of equity investment funds through listing, equity transfer and management repurchase. , resulting in no return on equity investment or even loss of principal. In the worst case, it may even lead to a complete loss of principal.
Capital market risk The capital market risk here mainly refers to the risks brought by policies, such as monetary policy, fiscal policy, industrial policy and regional development policy. As soon as the policy changes, the risk will come immediately. This kind of risk is a systematic risk that any investment project can't avoid, because the changes of macro policies such as interest rate adjustment have an impact on every enterprise in the system, but different industries are affected to different degrees.
Legal risks Legal risks are mainly reflected in the legal issues of contracts and intellectual property rights. Management contracts or other similar investment agreements signed between equity investment funds and investors, such as security of deposit and guaranteed rate of return, are often not protected by law, which is one of the investment risks. Improper conclusion of equity fund investment agreement and protection of trade secrets may also bring contract legal risks.
Execution risk The influencing factors of execution risk are mainly manifested in time. Not all equity investments can be listed and cashed out within the agreed time and have a good ending. Therefore, the imperfect exit mechanism will increase the risk of equity investment funds. The execution risk is also reflected in the operation of the investment process. The more complicated the implementation process is, the longer it takes, thus affecting the time cost and return rate of investment.
How to invest in equity investment? Equity investment is like doing business with others. What it pursues is the security of the principal and the continuous and stable return on investment. No matter whether the invested company can be listed in the securities market, it is an ideal investment object as long as it can bring considerable investment return to investors. Because the listing of enterprises can bring about a sharp rise in the stock price, some investors pay too much attention to the concept of "listing of enterprises" because of quick success and instant benefit, so that they ignore the understanding of the enterprises themselves, thus amplifying the investment risks and bringing opportunities to some scammers. Facts have proved that many investment temptations in the name of "overseas listing" and profiteering often end in scams. After all, there are always a few companies that can go public, and finding high-quality companies is the right way to invest.
Know the company you invest in. If you want to invest successfully, investors must have a certain degree of understanding of their investment targets. For example, the management ability and quality of company managers, whether they can think for shareholders, the company's assets, profitability, competitive advantage and other information. Because most investors have limited information collection ability, it is best for investors to invest in local high-quality enterprises. Investors can follow up and observe their operations through relatives and friends who work in enterprises or in banking, taxation and industrial and commercial departments, and can also communicate with corporate executives through some channels.
Controlling investment cost Even for high-quality companies, if the price of purchasing equity is too high, it will still lead to a long payback period and a decline in return on investment, which is not a good investment. Therefore, when making equity investment, we must calculate the time to recover the investment cost according to the normal profit level of the company. Usually, the time should be controlled within 10 years. However, when some investors buy stocks, they always compare the price after listing with the purchase cost, and rarely consider when the company can recover the cost if it cannot go public. This mentality of pursuing profiteering often leads to a sudden increase in investment risk.
Finally, I remind you that investment is risky and you need to be cautious when entering the market.