Investor
Encyclopedia
An investor is a party that makes an investment
into one or more categories of assets --- equity
, debt
securities
, real estate
, currency
, commodity
, derivatives such as put and call options, etc. --- with the objective of making a profit.
Also, investors might be classified according to their styles. In this respect, an important distinctive investor psychology trait is risk attitude
.
Investment
Investment has different meanings in finance and economics. Finance investment is putting money into something with the expectation of gain, that upon thorough analysis, has a high degree of security for the principal amount, as well as security of return, within an expected period of time...
into one or more categories of assets --- equity
Stock
The capital stock of a business entity represents the original capital paid into or invested in the business by its founders. It serves as a security for the creditors of a business since it cannot be withdrawn to the detriment of the creditors...
, debt
Bond (finance)
In finance, a bond is a debt security, in which the authorized issuer owes the holders a debt and, depending on the terms of the bond, is obliged to pay interest to use and/or to repay the principal at a later date, termed maturity...
securities
Security (finance)
A security is generally a fungible, negotiable financial instrument representing financial value. Securities are broadly categorized into:* debt securities ,* equity securities, e.g., common stocks; and,...
, real estate
Real estate
In general use, esp. North American, 'real estate' is taken to mean "Property consisting of land and the buildings on it, along with its natural resources such as crops, minerals, or water; immovable property of this nature; an interest vested in this; an item of real property; buildings or...
, currency
Currency
In economics, currency refers to a generally accepted medium of exchange. These are usually the coins and banknotes of a particular government, which comprise the physical aspects of a nation's money supply...
, commodity
Commodity
In economics, a commodity is the generic term for any marketable item produced to satisfy wants or needs. Economic commodities comprise goods and services....
, derivatives such as put and call options, etc. --- with the objective of making a profit.
Types of investors
The following classes of investors are not mutually exclusive:- Individual investors (including trusts on behalf of individuals, and umbrella companies formed by two or more to pool investment funds)
- CollectorsCollectingThe hobby of collecting includes seeking, locating, acquiring, organizing, cataloging, displaying, storing, and maintaining whatever items are of interest to the individual collector. Some collectors are generalists, accumulating merchandise, or stamps from all countries of the world...
of artArtArt is the product or process of deliberately arranging items in a way that influences and affects one or more of the senses, emotions, and intellect....
, antiquesAntiquesAn antique is an old collectible item. It is collected or desirable because of its age , beauty, rarity, condition, utility, personal emotional connection, and/or other unique features...
, and other things of value - Angel investors (individuals and groups)
- Sweat equitySweat equitySweat equity is a term that refers to a party's contribution to a project in the form of effort --- as opposed to financial equity, which is a contribution in the form of capital....
investor - Venture capitalVenture capitalVenture capital is financial capital provided to early-stage, high-potential, high risk, growth startup companies. The venture capital fund makes money by owning equity in the companies it invests in, which usually have a novel technology or business model in high technology industries, such as...
funds, which serve as investment collectives on behalf of individuals, companies, pension plans, insurance reserves, or other funds. - Investment banks
- Businesses that make investments, either directly or via a captive fund
- Investment trustInvestment trustAn Investment trust is a form of collective investment found mostly in the United Kingdom. Investment trusts are closed-end funds and are constituted as public limited companies....
s, including real estate investment trustReal estate investment trustA real estate investment trust or REIT is a tax designation for a corporate entity investing in real estate. The purpose of this designation is to reduce or eliminate corporate tax. In return, REITs are required to distribute 90% of their taxable income into the hands of investors...
s - 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 fundSovereign wealth fundA sovereign wealth fund is a state-owned investment fund composed of financial assets such as stocks, bonds, property, precious metals or other financial instruments. Sovereign wealth funds invest globally. Some of them have grabbed attention making bad investments in several Wall Street financial...
s
Also, investors might be classified according to their styles. In this respect, an important distinctive investor psychology trait is risk attitude
Risk aversion
Risk aversion is a concept in psychology, economics, and finance, based on the behavior of humans while exposed to uncertainty....
.
Investor protection
The term “investor protection” defines the entity of efforts and activities to observe, safeguard and enforce the rights and claims of a person in his role as an investor. This includes advise and legal action. The assumption of a need of protection is based on the experience that financial investors are usually structurally inferior to providers of financial services and products due to lack of professional knowledge, information and/or experience.See also
- Business oligarchBusiness oligarchBusiness oligarch is a near-synonym of the term "business magnate", borrowed by the English speaking and western media from post-Soviet parlance to describe the huge, fast-acquired wealth of some businessmen of the former Soviet republics during the privatization in Russia and other post-Soviet...
- BusinesspersonBusinesspersonA businessperson is someone involved in a particular undertaking of activities for the purpose of generating revenue from a combination of human, financial, or physical capital. An entrepreneur is an example of a business person...
- Captain of industryCaptain of industry"Captain of industry" was a term originally used in the United Kingdom during the Industrial Revolution describing a business leader whose means of amassing a personal fortune contributes positively to the country in some way....
- FinancierFinancierFinancier is a term for a person who handles typically large sums of money, usually involving money lending, financing projects, large-scale investing, or large-scale money management. The term is French, and derives from finance or payment...
- Media proprietorMedia proprietorA media proprietor is a person who controls, either through personal ownership or a dominant position in any media enterprise. Those with significant control of a public company in the mass media may also be called "media moguls", "tycoons", "barons", or "bosses".The figure of the media proprietor...
- Robber baron (industrialist)Robber baron (industrialist)Robber baron is a pejorative term used for a powerful 19th century American businessman. By the 1890s the term was used to attack any businessman who used questionable practices to become wealthy...
- Venture capitalist
- InvestmentInvestmentInvestment has different meanings in finance and economics. Finance investment is putting money into something with the expectation of gain, that upon thorough analysis, has a high degree of security for the principal amount, as well as security of return, within an expected period of time...
- Securities offeringSecurities offeringA securities offering is a discrete round of investment, by which a business or other enterprise raises money to fund operations, expansion, a capital project, an acquisition, or some other business purpose....
- Private equityPrivate equityPrivate equity, in finance, is an asset class consisting of equity securities in operating companies that are not publicly traded on a stock exchange....
- Corporate financeCorporate financeCorporate finance is the area of finance dealing with monetary decisions that business enterprises make and the tools and analysis used to make these decisions. The primary goal of corporate finance is to maximize shareholder value while managing the firm's financial risks...
- Stock investor
- Growth capitalGrowth capitalGrowth capital is a type of private equity investment, most often a minority investment, in relatively mature companies that are looking for capital to expand or restructure operations, enter new markets or finance a significant acquisition without a change of control of the business.Companies...
- Crowd fundingCrowd fundingCrowd funding describes the collective cooperation, attention and trust by people who network and pool their money and other resources together, usually via the Internet, to support efforts initiated by other people or organizations...
- Sweep accountSweep accountA sweep account is an account set up at a bank or other financial institution where the funds are automatically managed between a primary cash account and secondary investment accounts.- Overview :...
- Model auditModel AuditA model audit is the colloquial term for the tasks performed when conducting due diligence on a financial model, in order to eliminate spreadsheet error. . A study in 1998 concluded that even MBA students with over 250 hours of spreadsheet development experience had a 24% chance of introducing...