The advantage of private equity investment income is that it can reduce the transaction cost of investors, give full play to the advantages of risk management, increase the value of enterprises and reduce financial costs. The disadvantage of private equity investment income is that the income is unstable because of the change of equity.

legal ground

Article 5 of People's Republic of China (PRC) Securities Investment Fund Law

The debts of the fund property shall be borne by the fund property itself, and the fund share holders shall be liable for the debts of the fund property to the extent of their capital contribution. However, if the fund contract has other provisions in accordance with this Law, such provisions shall prevail. Fund property is independent of the inherent property of fund managers and fund custodians. Fund managers and fund custodians may not classify fund property as their inherent property. Property and income obtained by fund managers and fund custodians due to the management and use of fund property or other circumstances shall be classified as fund property. If a fund manager or fund custodian is liquidated due to dissolution, cancellation or bankruptcy according to law, the fund property does not belong to its liquidation property.