Sophisticated Investor certificate

[Monty Burns]

Has anyone been registered for a 'Sophisticated Investor' certificate?

Just wondering what if any benefits there may be or otherwise.

 

[jerrybee]

Is this a real thing or is it like the pen license you receive in primary school?

 

[Monty Burns]

Sophisticated Investor

it is real

The term sophisticated investor is used in the Corporations Act to describe a class of investor that can be offered securities without the usual product disclosure requirements that apply to everyday mum and dad investors.

To become a sophisticated investor, you have to acquire a certificate from a qualified accountant, stating that you have net assets of $2.5 million and/or that your gross income for the past two financial years has been at least $250,000 a year. That certificate must have been obtained within six months of accepting any wholesale offer to acquire securities.

It doesn't actually mean knowledge in investing but more about cash flow.

 

[jerrybee]

Interesting...

 

[Ace in the Hole]

I'm interested too.
Has anybody got onto good investments not open to the general public?

 

[Terry_w]

Look at Chapter 7 of the corporations act.

Having such a certificate may mean the normal compliance requirements may be reduced. - e.g. an offer of a financial product may not need a PDS.

 

[j_p]

Can mean you are offered products that may have risk in excess of the initial investment. Can't remember the source but turned me off the idea. Seemed the whole sophisticated investor thing is just a way to help people feel more important and risk getting taken advantage of.

 

[DaveM]

I have my certificate dont you all?

 

[Ace in the Hole]

Can you make one for me too, please Dave?

 

[wobbycarly]

Dave, you spelt it wrong, it's not "sophistimaction" it's "sophistimication".

 

[DaveM]

Real investors dont care about spelling

 

[cu@thetop]

I drink red wine. Am I sophisimicated enough to get a certificate?

 

[wobbycarly]

Real investors dont care about spelling

True. Especially the sophistimicated ones.

 

[sanj]

I'm interested too.
Has anybody got onto good investments not open to the general public?

I have with a few that were only available for sophisticated investors. As an example :

- investment in a public unlisted biotech firm, looks like they're on track to pass phase 3 trials in the next few months and should be listed within next 6 months. I'm expecting 500% gains when it lists and think there's a good chance it will grow strongly from there

- 3 rounds of raising for an online gaming /ggambling company, 3rd round is happening atm. Again I expect it to list late this year and hopefully see some scent gains

These tend to be riskier investments but opportunities that the general population wouldn't get exposed to.

 

[albanga]

One of Robert Kyiosakis books I read bangs on about this. Basically what the rich know that the poor don't.
As Sanj said I think it becomes very relevant if you want to invest in riskier areas that have HUGE potential for both gains and losses.

 

[redwing]

Look at Chapter 7 of the corporations act.

Having such a certificate may mean the normal compliance requirements may be reduced. - e.g. an offer of a financial product may not need a PDS.

A good or bad thing?

At least whomever your dealing with knows you have money with such a certificate and can afford them

 

[Ace in the Hole]

I have with a few that were only available for sophisticated investors. As an example :

- investment in a public unlisted biotech firm, looks like they're on track to pass phase 3 trials in the next few months and should be listed within next 6 months. I'm expecting 500% gains when it lists and think there's a good chance it will grow strongly from there

- 3 rounds of raising for an online gaming /ggambling company, 3rd round is happening atm. Again I expect it to list late this year and hopefully see some scent gains

These tend to be riskier investments but opportunities that the general population wouldn't get exposed to.

Thanks Sanj.

I'd be willing to punt my super bankroll on this kind of stuff, perfect investments for play money.
I'm not sure what's allowed, but I'd guess you could invest this stuff from a SMSF, if you have the sophisticated certificate in personal names?

I will consider these types if it can be done via Super.

 

[sanj]

Thanks Sanj.

I'd be willing to punt my super bankroll on this kind of stuff, perfect investments for play money.
I'm not sure what's allowed, but I'd guess you could invest this stuff from a SMSF, if you have the sophisticated certificate in personal names?

I will consider these types if it can be done via Super.

Youre welcome and Yup can be done via smsf.

these are definitely riskier investments so you have to be comfortable with that and able to lose money without losing the plot (some people struggle with losing money). with the gaming company I thought it was going to end up a dud investment as it floundered for a while but looks like it's coming good and should see some good gains.

 

[Monty Burns]

Youre welcome and Yup can be done via smsf.

these are definitely riskier investments so you have to be comfortable with that and able to lose money without losing the plot (some people struggle with losing money). with the gaming company I thought it was going to end up a dud investment as it floundered for a while but looks like it's coming good and should see some good gains.

Sanj,

Thanks for sharing.
Where do you start looking for these types of investments?

 

[The Falcon]

The best margin products - ie. Lowest rates (I have AUD at 4.10% and USD 2.21% currently) are only available to section 708 (sophisticated) investors. Off market capital raising and placements are availalable if your broker is lead as well. Also unlisted businesses that want to raise capital will typically go to 708s only through a broker. I know of one such opportunity that I will be involved with next year.

Found this that provides a general overview ;

http://www.afrsmartinvestor.com.au/...sophisticated_investor_F6p205BJ2HOMNBxqcj3RXL