First, the concept of non-standard assets
Non-standard assets, also known as non-standardized creditor's rights assets, refer to creditor's rights assets that are not traded in the interbank market and the stock exchange market.
Second, the characteristics of non-standard assets
1, customized:
Non-standard assets are usually customized by specific investors or institutions, so they are highly personalized. Each non-standard asset has its specific investment objectives, risk level and income expectation.
2. Wide investment scope:
Non-standard assets cover many different types of assets, including real estate, infrastructure, private equity, venture capital, securitization products and so on. This allows investors to choose their own investment targets according to their risk preferences and income expectations.
3. High returns and high risks coexist:
Non-standard assets usually have higher returns, but at the same time they are accompanied by higher risks. Since most non-standard assets are not traded in the open market, the price discovery mechanism is relatively imperfect, and investors need to evaluate risks and benefits more carefully.
4. Information disclosure is opaque:
The information disclosure of non-standard assets is relatively opaque, and investors mainly rely on the due diligence report and investment agreement of the asset issuer to understand the investment target. Therefore, investors need to have high risk management ability and due diligence ability.
5. Poor liquidity:
Most non-standard assets are not traded in the open market and have poor liquidity, so it may be difficult for investors to cash in quickly when they need funds.
Application of nonstandard assets in financial market;
1, to meet specific investment needs:
Non-standard assets can meet the investment needs of investors for specific asset types, risk levels and income expectations. For example, some investors may prefer to invest in certain types of assets, such as real estate or infrastructure, rather than stocks and bonds on the open market.
2, improve the investment income:
Non-standard assets usually have higher yields and are attractive to investors who pursue higher returns. For example, some private equity funds can get higher returns in the short term by investing in startups or small businesses.
3. Risk dispersion:
Non-standard assets can be used as an effective supplement to the portfolio to help investors achieve risk diversification. Because of the low correlation between non-standard assets and assets in the open market, adding them to the portfolio can reduce the overall risk.
4. Liquidity management:
For some investors with large liquidity needs, non-standard assets can meet their liquidity management needs by providing longer-term stable income. For example, some long-term infrastructure projects can provide investors with stable cash flow and reliable sources of income.
5. Capital appreciation:
Some non-standard assets have great appreciation potential, such as real estate and private equity funds. By investing in these assets, investors can realize capital appreciation in a long time.