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Wikipedia

Investor

An investor is a person who allocates financial capital with the expectation of a future return (profit) or to gain an advantage (interest).[1][2] Through this allocated capital most of the time the investor purchases some species of property.[3] Types of investments include equity, debt, securities, real estate, infrastructure, currency, commodity, token, derivatives such as put and call options, futures, forwards, etc. This definition makes no distinction between the investors in the primary and secondary markets. That is, someone who provides a business with capital and someone who buys a stock are both investors. An investor who owns stock is a shareholder.

Types of investors edit

There are two types of investors: retail investors and institutional investors.[4]

A retail investor is also known as an individual investor.[5]

There are several sub-types of institutional investor:

Investors might also be classified according to their profiles. In this respect, an important distinctive investor psychology trait is risk attitude.

Investor protection through government edit

Investor protection through government involves regulations and enforcement by government agencies to ensure that market is fair and fraudulent activities are eliminated. An example of a government agency that protects investors is the U.S. Securities and Exchange Commission (SEC), which works to protect reasonable investors in the United States.[1]

Similar protections exist in other countries, including the United Kingdom where individual investors have certain protections via the Financial Services Compensation Scheme (FSCS).[7]

Investment tax structures edit

Company dividends are paid from net income, which has the tax already deducted. Therefore, shareholders are given some respite with a preferential tax rate of 15% on "qualified dividends" in the event of the company being domiciled in the United States. Alternatively, in another country having a double-taxation treaty with the US, accepted by the Internal Revenue Service (IRS). Non-qualified dividends paid by other foreign companies or entities; for example, those receiving income derived from interest on bonds held by a mutual fund, are taxed at the regular and generally higher rate of income tax. When applied to 2013, this is on a sliding scale up to 39.6%, with an additional 3.8% surtax for high-income taxpayers ($200,000 for singles, $250,000 for married couples).[8]

Role of the financier edit

A financier (/fɪnənˈsɪər, fə-, -ˈnæn-/)[9][10] is a person whose primary occupation is either facilitating or directly providing investments to up-and-coming or established companies and businesses, typically involving large sums of money and usually involving private equity and venture capital, mergers and acquisitions, leveraged buyouts, corporate finance, investment banking, or large-scale asset management. A financier makes money through this process when his or her investment is paid back with interest,[11] from part of the company's equity awarded to them as specified by the business deal, or a financier can generate income through commission, performance, and management fees. A financier can also promote the success of a financed business by allowing the business to take advantage of the financier's reputation.[12] The more experienced and capable the financier is, the more the financier will be able to contribute to the success of the financed entity, and the greater reward the financier will reap.[13] The term, financier, is French, and derives from finance or payment.

Financier is someone who handles money. Certain financier avenues require degrees and licenses including venture capitalists, hedge fund managers, trust fund managers, accountants, stockbrokers, financial advisors, or even public treasurers. Personal investing on the other hand, has no requirements and is open to all using the stock market or by word-of-mouth requests for money. A financier "will be a specialized financial intermediary in the sense that it has experience in liquidating the type of firm it is lending to".[11]

Perceptions edit

Economist Edmund Phelps has argued that the financier plays a role in directing capital to investments that governments and social organizations are constrained from playing:

[T]he pluralism of experience that the financiers bring to bear in their decisions gives a wide range of entrepreneurial ideas a chance for insightful evaluation. And, importantly, the financier and the entrepreneur do not need the state's or social partners' approval. Nor are they accountable later on to such social bodies if the project goes badly, not even to the financier's investors. So projects that would be too opaque and uncertain for the state or social partners to endorse can be undertaken.[14]

The concept of the financier has been distinguished from that of a mere capitalist based on the asserted higher level of judgment required of the financier.[15] However, financiers have also been mocked for their perceived tendency to generate wealth at the expense of others, and without engaging in tangible labor. For example, humorist George Helgesen Fitch described the financier as "a man who can make two dollars grow for himself where one grew for someone else before".[16]

See also edit

Further reading edit

  • Josephson, Matthew (1972). The Money Lords: The Great Finance Capitalists, 1925–1950. New York: Weybright and Talley.
  • Graham, Benjamin; Zweig, Jason (February 21, 2006) [1949]. The Intelligent Investor: The Definitive Book on Value Investing (Revised ed.). HarperCollins. ISBN 0-06-055566-1.

References edit

  1. ^ a b Lin, Tom C.W. (2015). "Reasonable Investor(s)". Boston University Law Review. 95 (461): 466.
  2. ^ "Investor". Cambridge English Dictionary. Cambridge University Press. Retrieved November 29, 2019.
  3. ^ Fisher, Jonathan; Bewsey, Jane; Waters, Malcolm; Ovey, Elizabeth (2003). The Law of Investor Protection (2nd ed.). London: Sweet & Maxwell.
  4. ^ Palmer, Barclay (August 11, 2023). "Institutional vs. Retail Investors: What's the Difference?". Investopedia. Retrieved October 5, 2023.
  5. ^ Hayes, Adam. "Retail Investor Definition". Investopedia. Retrieved December 17, 2020.
  6. ^ "Institutional Investor – Overview, Types, Investing Risks". Corporate Finance Institute. Retrieved December 17, 2020.
  7. ^ "Investments". Financial Services Compensation Scheme Ltd. Retrieved November 11, 2023.
  8. ^ "Investment Tax Basics for All Investors". Investopedia. Retrieved December 30, 2014.
  9. ^ "financier". The American Heritage Dictionary. Houghton Mifflin Harcourt Publishing Company.
  10. ^ "financier | meaning of financier". Longman Dictionary of Contemporary English.
  11. ^ a b Xavier Freixas, Jean-Charles Rochet, Microeconomics of Banking (2008), p. 227.
  12. ^ Landström, Hans (2007). Handbook of Research on Venture Capital. p. 202.
  13. ^ Neave, Edwin H. (2009). Modern Financial Systems: Theory and Applications. p. 8.
  14. ^ Phelps, Edmund S. (October 10, 2006). "Dynamic Capitalism" (PDF). Europa-Institut.
  15. ^ Elliott, Sterling, ed. (1896). Good Roads: Devoted to the Construction and Maintenance of Roads. Vol. 24. p. 366.
  16. ^ Fitch, George (1916). Vest Pocket Essays. p. 123.

External links edit

  •   Media related to Investors at Wikimedia Commons

investor, swedish, investment, company, this, article, needs, additional, citations, verification, please, help, improve, this, article, adding, citations, reliable, sources, unsourced, material, challenged, removed, find, sources, news, newspapers, books, sch. For the Swedish investment company see Investor AB This article needs additional citations for verification Please help improve this article by adding citations to reliable sources Unsourced material may be challenged and removed Find sources Investor news newspapers books scholar JSTOR March 2015 Learn how and when to remove this template message An investor is a person who allocates financial capital with the expectation of a future return profit or to gain an advantage interest 1 2 Through this allocated capital most of the time the investor purchases some species of property 3 Types of investments include equity debt securities real estate infrastructure currency commodity token derivatives such as put and call options futures forwards etc This definition makes no distinction between the investors in the primary and secondary markets That is someone who provides a business with capital and someone who buys a stock are both investors An investor who owns stock is a shareholder Contents 1 Types of investors 2 Investor protection through government 3 Investment tax structures 4 Role of the financier 4 1 Perceptions 5 See also 6 Further reading 7 References 8 External linksTypes of investors editThere are two types of investors retail investors and institutional investors 4 A retail investor is also known as an individual investor 5 There are several sub types of institutional investor Pension plans making investments on behalf of employees Businesses that make investments either directly or via a captive fund Endowment funds used by universities churches etc Mutual funds hedge funds and other funds ownership of which may or may not be publicly traded these funds typically pool money raised from their owner subscribers to invest in securities Sovereign wealth funds Large money managers 6 Investors might also be classified according to their profiles In this respect an important distinctive investor psychology trait is risk attitude Investor protection through government editInvestor protection through government involves regulations and enforcement by government agencies to ensure that market is fair and fraudulent activities are eliminated An example of a government agency that protects investors is the U S Securities and Exchange Commission SEC which works to protect reasonable investors in the United States 1 Similar protections exist in other countries including the United Kingdom where individual investors have certain protections via the Financial Services Compensation Scheme FSCS 7 Investment tax structures editCompany dividends are paid from net income which has the tax already deducted Therefore shareholders are given some respite with a preferential tax rate of 15 on qualified dividends in the event of the company being domiciled in the United States Alternatively in another country having a double taxation treaty with the US accepted by the Internal Revenue Service IRS Non qualified dividends paid by other foreign companies or entities for example those receiving income derived from interest on bonds held by a mutual fund are taxed at the regular and generally higher rate of income tax When applied to 2013 this is on a sliding scale up to 39 6 with an additional 3 8 surtax for high income taxpayers 200 000 for singles 250 000 for married couples 8 Role of the financier edit Financier redirects here For the French cake see Financier cake A financier f ɪ n e n ˈ s ɪer f e ˈ n ae n 9 10 is a person whose primary occupation is either facilitating or directly providing investments to up and coming or established companies and businesses typically involving large sums of money and usually involving private equity and venture capital mergers and acquisitions leveraged buyouts corporate finance investment banking or large scale asset management A financier makes money through this process when his or her investment is paid back with interest 11 from part of the company s equity awarded to them as specified by the business deal or a financier can generate income through commission performance and management fees A financier can also promote the success of a financed business by allowing the business to take advantage of the financier s reputation 12 The more experienced and capable the financier is the more the financier will be able to contribute to the success of the financed entity and the greater reward the financier will reap 13 The term financier is French and derives from finance or payment Financier is someone who handles money Certain financier avenues require degrees and licenses including venture capitalists hedge fund managers trust fund managers accountants stockbrokers financial advisors or even public treasurers Personal investing on the other hand has no requirements and is open to all using the stock market or by word of mouth requests for money A financier will be a specialized financial intermediary in the sense that it has experience in liquidating the type of firm it is lending to 11 Perceptions edit Economist Edmund Phelps has argued that the financier plays a role in directing capital to investments that governments and social organizations are constrained from playing T he pluralism of experience that the financiers bring to bear in their decisions gives a wide range of entrepreneurial ideas a chance for insightful evaluation And importantly the financier and the entrepreneur do not need the state s or social partners approval Nor are they accountable later on to such social bodies if the project goes badly not even to the financier s investors So projects that would be too opaque and uncertain for the state or social partners to endorse can be undertaken 14 The concept of the financier has been distinguished from that of a mere capitalist based on the asserted higher level of judgment required of the financier 15 However financiers have also been mocked for their perceived tendency to generate wealth at the expense of others and without engaging in tangible labor For example humorist George Helgesen Fitch described the financier as a man who can make two dollars grow for himself where one grew for someone else before 16 See also editAccredited investor Investor with a special legal status Compound interest Compounding sum paid for the use of money Crowd funding Collection of finance from backers the crowd to fund an initiativePages displaying short descriptions of redirect targets Financial literacy Able to make informed choices about money Institutional investor Investors who invest professionally and as their main occupation in the stock market Investor state dispute settlement Mean for a business to sue a government Growth capital Type of private equity investment Model audit Colloquial term for the tasks performed when conducting due diligence on a financial model Philanthrocapitalism Method of philanthropy that mirrors a for profit business Real estate investing Buying and selling real estate for profit Saving account Type of bank accountPages displaying short descriptions of redirect targets Securities offering Discrete round of investment Socially responsible investing Any investment strategy combining both financial performance and social ethical impact Stock investor Person or company involved in trading equity securitiesPages displaying short descriptions of redirect targets Time value of money Conjecture that there is greater benefit to receiving a sum of money now rather than laterFurther reading editJosephson Matthew 1972 The Money Lords The Great Finance Capitalists 1925 1950 New York Weybright and Talley Graham Benjamin Zweig Jason February 21 2006 1949 The Intelligent Investor The Definitive Book on Value Investing Revised ed HarperCollins ISBN 0 06 055566 1 References edit a b Lin Tom C W 2015 Reasonable Investor s Boston University Law Review 95 461 466 Investor Cambridge English Dictionary Cambridge University Press Retrieved November 29 2019 Fisher Jonathan Bewsey Jane Waters Malcolm Ovey Elizabeth 2003 The Law of Investor Protection 2nd ed London Sweet amp Maxwell Palmer Barclay August 11 2023 Institutional vs Retail Investors What s the Difference Investopedia Retrieved October 5 2023 Hayes Adam Retail Investor Definition Investopedia Retrieved December 17 2020 Institutional Investor Overview Types Investing Risks Corporate Finance Institute Retrieved December 17 2020 Investments Financial Services Compensation Scheme Ltd Retrieved November 11 2023 Investment Tax Basics for All Investors Investopedia Retrieved December 30 2014 financier The American Heritage Dictionary Houghton Mifflin Harcourt Publishing Company financier meaning of financier Longman Dictionary of Contemporary English a b Xavier Freixas Jean Charles Rochet Microeconomics of Banking 2008 p 227 Landstrom Hans 2007 Handbook of Research on Venture Capital p 202 Neave Edwin H 2009 Modern Financial Systems Theory and Applications p 8 Phelps Edmund S October 10 2006 Dynamic Capitalism PDF Europa Institut Elliott Sterling ed 1896 Good Roads Devoted to the Construction and Maintenance of Roads Vol 24 p 366 Fitch George 1916 Vest Pocket Essays p 123 External links edit nbsp Media related to Investors at Wikimedia Commons Retrieved from https en wikipedia org w index php title Investor amp oldid 1190107342, wikipedia, wiki, book, books, library,

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