The Fund Doctor » Investment Funds

Sweden Adds Backing to UK Call on AIFM Draft Directive

admin — Tue, 04 Aug 2009 21:02:29 +0000

Lord Myners returned from his meeting with Swedish counterparts late last week with the support of the Swedes who assume the EU Presidency on July 1st.

While this is good news for the hedge fund and alternative investment industry, there is still a great deal of work left to do to unravel the draconian and politically motivated piece of draft regulation. The French and Germans are on notice that there will be intensive lobbying efforts by the UK Government to ameliorate the proposed legislation, but is it simply the UK with it’s hedge fund stable which has the most to lose?

Capital will move to where it can do business most effectively – odd the principal of freedom of capital movement across borders should have been ignored by the EU legislators themselves. A growing chorus of hedge funds are threatening to upsticks and move operations elsewhere if the legislation goes through and realistically, there isn’t much to stop them – hedge funds are hardly mega-employers and there are pools of skilled talent for back-office functions elsewhere in the world (including Hong Kong where ComplianceAsia is based).

While the French and, to a lesser extent, the Germans, are going to be subjected to intensive lobbying and political back-scratching which is par for the course in promulgating legislation, both the promoters and critics of the AIFM should be aware they are not the only players in the EU legislature.

Nor are hedge funds the only “forbidden” fruit.

Ireland, for instance, has voiced concerns over the draft Directive, not least because of the number of hedge funds administered out of Dublin, but also due to the wide-ranging net of the AIFM definition of “Alternative Investment Funds” (AIF’s). The definition of AIF’s are “any collective investment fund not required to be authorised as a UCITS” – in other words, any investment fund other than securities fund!

Expect battle-lines to become clearly defined and it is going to be interesting to see how proponents of the measures respond to calls they do not know what they are doing.

For the latest in compliance and regulatory news from the US, UK, EU and the Far East visit ComplianceAsia’s blog. This article was commissioned by ComplianceAsia, the leading APACS region provider of outsourced compliance support for leading banking and financial institutions operating in the region. You can keep abreast of the best of international regulatory news from Washington D.C., New York, London and around the world at http://complianceasia.squarespace.com

Guest Post by Karl Hindle

All Worldwide Rights Reserved http://bigridgemedia.com

Investment bottelnecks removed for the Mid- Atlantic Branch of Angel Investment Network

admin — Wed, 31 Dec 2008 11:43:52 +0000

Read the papers today, and you’ll feel like start-ups are a rare breed in 2009. Many sources say less people are starting up companies, albeit successfully too – citing the lack of investors available as one of the top reasons. But perhaps they are not looking in the right places.

A paper in Philadelphia (Philadelphia Inquirer & Daily News) recently did a story in which a start-up CEO almost seemed to feel like securing angel investment was easier in this market than before. And it makes sense, since less competition combined with more places to look for funding make this a good time for companies to secure investment.

It is true that angel investors are becoming more cautious, and one will need a strong, convincing business plan (or some already existing activity) in order to secure such funding, but this has always been the case. However, sites such as the Mid-Atlantic Investment Network help potential entrepreneurs and existing start-ups alike find more channels in which to reach these investors.

Many companies will look to raise “Seed Capital” from a wide variety of courses, including friends and family. But the Mid-Atlantic Investment Network allows members to look beyond that, with the ability to broadcast your plans to other potential investors online.

While technology remains one of the top niches in angel investment (such as the recent development by an entrepreneur in Maryland to develop software that uses facial recognition technology to determine who can see the content on-screen), other fields are also attracting entrepreneurs and angel investors these days. Our network has active investors and entrepreneurs in fields such as Real Estate, Retail, Business Services, Transportation, Health Care, Entertainment, Agriculture and more.

A wide range of investors are members, including various angel investors from within Mid-Atlantic regions such as Delaware, Maryland (including Baltimore), Pennsylvania (Philadelphia, Pittsburgh, etc), Virginia, West Virginia and Washington D.C, but also features investors located across the country and internationally.

Join the Mid-Atlantic branch of the Angel Investment Network today and find someone to help get your business off of the ground.

What are Hedge Funds and Starting Your Own Hedge Fund

admin — Wed, 24 Dec 2008 19:21:58 +0000

WHAT ARE HEDGE FUNDS?

www.turnkeyhedgefunds.com

In the securities world, the term “Hedge Fund” does not necessarily imply any use of “hedging” as commonly understood; for example where commodity traders use options to “hedge” a commodity position. Presently, in the securities world the term “hedge fund” refers to any type of Private Investment Company operating under certain exemptions from registration under the Securities Act of 1933 and the Investment Company Act of 1940. “Hedge Funds” are often referred to as “alternate investment vehicles” and are tailored to the needs of sophisticated, high net worth private investors. A Hedge Fund is generally structured as a limited partnership having a general partner responsible for the investment activities and day-to-day operation of the fund, and limited partners who are the investors supplying capital but not participating in trading or operations of the fund. The limited partners have limited liability. That is, their exposure to loss is limited to their investment. The General Partner has unlimited liability and is liable for the activities of the partnership. The General Partners principals limit their liability through the use of a corporation or limited liability company as the General Partner. (Of course, the principals cannot limit their liability from the application of the anti fraud provisions of the Federal Securities Laws.) All of the investors’ capital is pooled and is utilized by the General Partner or Investment Manager to implement its trading or investment strategy.

Hedge Funds are “Non-Public Offerings.” The private offering exemption prohibits Hedge Funds from making any public offering. Therefore, Hedge Funds are prohibited from general advertising and generally secure investors through word of mouth, consultants, registered representatives, brokers or investment advisors. Hedge Funds have investors that are either “accredited investors” or “qualified purchasers.” In general, the Federal Securities Laws define the terms “accredited investor” and “qualified purchaser” in terms of minimum asset and income threshold that must be met before they qualify to be investors in the Hedge Fund. Since the Hedge Fund generally limits investment to “accredited investors” or “qualified purchasers” both of whom are required to meet certain minimal asset and/or income thresholds, the Fund Manager or administrator must gather background information on potential investors to determine whether they meet the minimum requirements to be “accredited investors” or “qualified purchasers.” By making a non-public offering to certain kinds of investors, (accredited investors or qualified purchasers) the investment vehicle will be exempt from registration requirements of The Securities Act of 1933 pursuant to the safe harbour provisions of Rule 506 of Regulation D. Where the investment vehicle is limited to no more than 100 investors, and otherwise complies with the safe harbour provisions of Regulation D, such an investment entity is exempt from the extensive regulation pursuant to Section 3(c)1 of The Investment Company Act. Section 3(c)7 of The Investment Company Act offers a similar exemption to private investment companies with “qualified purchasers” as investors.

As an unregulated entity, the Hedge Fund Investment Manager is free to undertake greater risk on more volatile positions thereby exposing investors to potential substantial profit as well as substantial losses.

Typically, Hedge Funds provide for the payment of an Incentive Allocation or Performance Fee to the hedge Fund Manager/General Partner. Performance Fees range from 20% to 40% depending on the strategy employed by the Hedge Fund Manager. Typically, the Performance Fee provides for a “high water mark” structure which provides that incentive fees are paid only to the extent that the fund continues to meet or exceed the “high water mark.” Additionally, typical Hedge Funds include Management Fee of 1% to 2% of all assets under management.

Generally there are two kinds of Hedge Funds. On the one hand, there are the huge worldwide funds operated by charismatic managers such as George Soros. On the other hand, there are small boutique-styled Hedge Funds identified with a particular segment or investment strategy. The Fund Manager’s expertise, experience and background in recognizing investment opportunity will dictate that fund’s particular niche. For example, there are the “Biotech Hedge Funds” which are managed by experienced and highly qualified investment managers who may also hold advanced degrees in science and medicine. There are “Tech Hedge Funds” specializing in the technology sector managed by individuals having specialized experience trading in that sector. With the emergence of day trading and the availability of the trading technology, a number of floor traders and brokers are leaving the traditional brokerage and exchange venue to participate in the computer screen trading phenomena.

The boutique “Hedge Fund” typically relies on the particular skill and expertise of the Investment Manager or Trader. The highly specialized Investment Manager may utilize a “Sector” style of investing focusing on a particular industry or economic sector. Conversely, an Investment Manager utilizing a “Market Neutral” style will maintain a portfolio of securities which are generally ½ short and ½ long. Some Investment Managers utilize a “Value” investment style based upon assets, cash flow and book value; while other Investment Managers follow the “Emerging Markets” style and invest in emerging and foreign market equity and debt. “Trading” funds utilize an opportunistic investment style taking advantage of market trends, events and opportunities for short term profits. Each Fund Manager develops and uses a particular investment style that is unique to the experience, expertise and personality of its manager.

Unlike Hedge Funds, Mutual Funds raise money publicly; are highly regulated by the Securities and Exchange Commission, the Internal Revenue Service and other agencies; and offer investment diversification and are restricted from purchasing many types of derivative instruments, leveraging, short selling and other kinds of transactions.

Unlike the Mutual Fund Managers, the Hedge Fund Manager generally invests in the fund that they manage and participate in profits as well as risks with their investors. Unlike the Mutual Fund fee structure (which is determined on assets under management) the Hedge Fund Manager receives incentive allocations on performance.

www.turnkeyhedgefunds.com

Holiday Loans: Invest Fund to Make Your Tour in Peace

admin — Mon, 08 Dec 2008 15:43:32 +0000

Expensive traveling and tour during the holiday season in particular has made holiday a harrowing affair. If you are one the shoppers wondering how you are going to pay for it all, Holiday Loans may tempt you. These loans are marketed to people at a time when they are probably most financial vulnerable.

As per your convenience and demands, these loans come in secured and unsecured forms. Secured form of borrowing can bestow you with a good amount of money on cheap rate for a longer period. With the fund, not only you can make your tour free from any kind of financial fuss but also give a boost to your usually fiscal affairs. On the other hand, unsecured loans in which borrowers do not have to place any of their worth assets as of security for the loan. For the reason, a small fund is granted for a shorter period. More so, obtaining the sum gets a little costlier.

With the raised fund, you can cover the cost of your holiday expenses. The expense encompasses traveling charges, food and lodging, and other sundry outlays.

These loans are not bound to a particular class of people. People having adverse credit records can also avail the benefits of the money provisions. All that they are required is to have shop around for the best possible finance product. In this prospect, quarters of lenders are available online and offline, processing online though is gaining precedence. It saves a great amount of your time and energy, and makes your loan approval fast.

So, taking a leave from your hectic day-to-day schedule is good. But spending for momentarily with your family or dear one at your dream place can be funded by holiday loans. Such financial packages give relief from occurring cost of expenses throughout your tour. And you spend some days snugly successfully.

Forex, Hedge Funds. Registering With the Commodity Futures Trading Commission

admin — Tue, 25 Nov 2008 22:11:13 +0000

www.turnkeyhedgefunds.com

ForEx, hedge funds. Registering with the Commodity Futures Trading Commission

Generally, the Commodity Futures Trading Commission has jurisdiction over transactions in ForEx futures and options contracts offered to retail customers, and the only counterparties that can lawfully enter into these contracts with retail customers on an off-exchange basis are persons that are: (i) registered with the Commission as a futures commission merchant (FCM); (ii) certain affiliates of a registered FCM;, or (iii) otherwise regulated, e.g., as a securities broker-dealer, a bank, a financial institution or an insurance company.

On May 22, 2008, the Congress passed the Farm Bill which, in Title XIII, contains several amendments to the Commodity Exchange Act involving the retail trading of foreign exchange.

Under the CFTC Reauthorization Act, a person operating pool solely trading spot ForEx is not required to register as a CPO at this time (but may be so required in the future upon promulgation of regulations by the CFTC).

If I start up a Fund of Funds and allocate among equity and futures funds what kinds of registration issues do I need to be concerned with?

As a Fund of Funds you must be aware of each particular states Investment Advisor rules. Many states have exemptions from registration. Also if you intend to invest in futures or commodity funds, you should register with the National Futures Association (NFA) and the Commodity Futures Trading Commission (CFTC) as a Commodity Pool Operator (CPO). This CPO’s associated person must successfully complete the NASD Series 3 examination.

Must a finder be registered as a broker-dealer?

Generally, No. Generally a finder does not have to be registered as a broker-dealer if its finder’s activities are limited. A “broker” under the Securities Exchange Act of 1934 is “any person engaged in the business of effecting transactions in securities for the account of others.” The SEC staff has found activities such as (a) participating in presentations or negotiations, (b) making any recommendations concerning securities, (c) receiving transaction-based compensation, (d) structuring a transaction or making recommendations regarding the nature of the securities, whether to issue securities or to assess the value of securities sold, and (e) continuing involvement in sales of securities to trigger broker-dealer registration obligations. However, a number of states, Texas and California for example, take the position that only a registered representative (broker) may receive kind of compensation.

Are there any other types of finders available to issuers in a private placement?

Yes. Rule 3a4-1 provides a non-exclusive safe harbor from the definition of a broker for persons associated with an issuer who are engaged in securities-related activities incident to their duties on behalf of the issuer. See Securities Exchange Act Rel. No. 22172 (June 27, 1985). Employees and possibly individual affiliates of an issuer who are not registered representatives of broker-dealers may be considered “associated persons” for purposes of Rule 3a4-1, in which case they may be exempt from registration and will be permitted to engage in limited sales activities pursuant to the Rule’s safe harbor.

www.turnkeyhedgefunds.com

Largest Lawsuit Settlement Funding Cases

admin — Sun, 16 Nov 2008 08:35:09 +0000

If you have been searching for settlement funding chances are you’ve heard of LawLeaf. You may have applied with several other companies only to find out they can’t provide funding for over a certain dollar amount.

LawLeaf an online provider of lawsuit funding services has no limit on the amount of money they can get for their clients. Over the last 6 months, the company has seen a major increase in larger requests for pre settlement loans. These request include loans for $1,000,000, $2,000,000 and even $10,000,000+ in non recourse funding.

What are the cases that generally are approved for million dollar pre settlement funding?

Business’s and individuals alike file lawsuits against major corporations and companies each day in the United States. Some of the more common lawsuits include:

copyright infringement breach of contract patent infringement securities & financial fraud civil rights products liability

These are a sample of cases that can bring in the largest pre settlement loans the industry provides. These types of loans are referred to as commercial litigation loans.

When a plaintiff (individual or company) enters into a multi-million dollar lawsuit against a company, chances are the lawsuit will last for several years before a verdict is reached. When a person or company has financial obligations at stake they may request a pre settlement loan while waiting for closure.

Commercial litigation financing is on the rise throughout the United States. When a company sues another company there is a good chance they may be having cash flow problems which is directly related to the lawsuit. A company may need a cash advance to help make payroll or to keep their doors open. This may require a company to request several million dollars to do so. When an individual requests millions in settlement funding they may be looking to recoup money lost in investments or development costs for a product that was stolen.

There are a variety of different types of commercial dispute claims filed each day in the United States and those claims can be in the hundreds of millions. No matter the size of the lawsuit, when both an individual or company is searching for a multi-million dollar lawsuit loan, they are turning to LawLeaf for help.

If you are searching for a pre settlement loan over a million dollars begin by applying with LawLeaf today. LawLeaf handles both small and large lawsuit cash advances for clients throughout the United States.

For additional information on commercial litigation financing, visit LawLeaf today.

Socially Responsible Investing Funds In The Stock Market

admin — Sun, 16 Nov 2008 01:43:54 +0000

Companies which use animal testing, for example, are not included amongst SRI fund companies. However you cannot always tell from the type of company it is whether it will be SRI or not. Tobacco could be included on the SRI list, for example, but firearms may not.

There are certain criteria which must be met if a company is to be chosen as an SRI fund company in the stock market. All companies would be required to go through a screening process to assess this.

There are many SRI fund companies which are around today, and one of the biggest of these is the Pax World, which was formed in 1971 and was one of the first companies to determine its availability according to social and financial criteria. Nowadays Pax World has some 175 funds under it, and these are valued at over two trillion dollars all together.

Pax World’s SRI funds do not invest in companies which are involved with tobacco or firearms, or products which are concerned with the gambling industry. They are also involved with the issue of employer-employee relationships. Socially responsible investment is not always entirely possible for companies, but we can see from the example of Pax World what companies can achieve in this regard.

Domini Social Investments are another SRI fund which are worth investors being aware of, as they track the Domini 400 Social Index, which was formed in 1991 and which lists ethical companies. Investments in the Standard and Poor 500 Index do not return as well on investment as those in this index do.

The FTSE4 good index has been in operation since 2001, and it lists companies which fit the criteria for a socially responsible organization. This index is a tradable one, which investors can use as a guideline for investment in this type of company, and it is a series which makes these funds available to people who are interested in this particular type of investment.

In fact it covers 90% of financial markets, and any groups which are listed on the series are required to meet internationally set CSR standards.

The Dow Jones group has used the Dow Jones Sustainability Group Indexes since 1999, and this provides a listing of companies in the stock market which satisfies the criteria according to environmental, economic and social standards.

This kind of fund makes a great stock market investment, which is well worth your consideration. Keep in mind there are always new opportunities for this kind of investment being added to the stock market each year.

California Schools Educators Retirement System and Lionstone Group Create Investment Fund

admin — Tue, 11 Nov 2008 16:35:48 +0000

The California State Teachers’ Retirement System (CSTRS) is the second largest public pension fund in the nation, providing retirement, disability and survivor benefits to California schools educators. Over 776,000 kindergarten through community college educators are members of the CSTRS, which currently has an investment portfolio of $142 billion.

Keeping quality educators in the California schools is of primary concern to everyone in the state. Without well-educated California schools youth, the city, businesses and economy of the state will suffer. Thus, when Lionstone Group, a research-based real estate investment firm, announced last month they and CSTRS had formed a discretionary $100 million real estate investment fund, the news was well received by everyone. As with any organization, good benefits will attract and keep quality educators in the California schools.

What makes the announcement so exciting is Lionstone’s track record with another fund it created with the Oregon Public Employees Retirement Fund (OPERF). Called the Cash Flow Office One, the fund has consistently exceeded expectations since its inception in December 2002. At that time, OPERF committed $75 million to the fund, expecting Lionstone to invest the capital within 24 months. Lionstone invested over 80 percent of OPERF’s capital within 12 months with excellent returns. OPERF expanded its funding commitment in 2004 and now has over $200 million of equity and owns 20 office buildings around the country that are valued at $550 million.

Like OPERF’s fund, the California schools educators’ fund, known as the Cash Flow Office Two, will target high occupancy office buildings in permanent locations across the United States.

CSTRS has committed $100 million to the fund, which can grow to over $500 million over time. Lionstone contributes one percent of the fund’s total equity. With the combined equity added to debt of up to 50 percent loan-to-value (LTV), the total buying power of the fund is approximately $1 billion.

The Lionstone Group was formed in 2001. It creates national investment strategies using primary research. Dedicated teams execute each investment strategy, including the fund for the California schools educators. Before creating the fund with the California schools educators’ retirement system, Lionstone refined their investment process to target locations that produce buildings with lower risk factors, according to Lionstone Principal Dan Dubrowski.

The California schools CSTRS Portfolio Manager Michael Thompson stated that the Lionstone management team over the Cash Flow Office Two fund is very entrepreneurial. He added that their skill set will enable CSTRS to continue to grow their core real estate portfolio.

This news gives all California schools educators hope for a better future, knowing they have an excellent resource during their tenure with the California schools and in retirement.

What are the Benefits of Offshore Investing

admin — Thu, 06 Nov 2008 23:58:18 +0000

The most important advantage in offshore investing is that you can make a lot of money without paying almost any taxes.If the investor lives in a place where he pays taxes like most countries then he will only pay taxes on his dividend or interest made.

Offshore funds have a clear advantage over their high tax counterparts even if income potentials were similar. They mainly offer financial services in general but concentrate particularly on offshore investment. It is very well known that funds offer the investor an affordable and easy method to access a wide variety of professionally managed investments.

All these different kind of offshore funds and their onshore competitors carry several benefits.Not only the fact that the offshore funds have tax benefits but that they are scructured in the same way as their onshore competitors.They also clearly state that they are registered offshore.

A wide variety of offshore investment are out there such as income, bond, capital, money, property, equity and rising market funds.All these different funds have a lot of benefits such as affordability, tax benefits, diversification, regulation, variety and professional management.

Most of these offshore funds carry a wide variety of comomodities in their portfolio.Investors who are into currency trading will definately like offshore investment funds.When investing in offshore funds you will have the possibilty to spread your investment in such a way that you reduce your risk and and create the potential of making higher profits.When you are not an active trader the offshore investment funds offer managed and pooled accounts to invest in.

Keeping your assets offshore or offshore investing is not necessary if you are an expatriate, but it is considered to be the most tax efficient way of managing your money. Hence if you are interested in offshore investments, these funds are available on the internet. Hedge funds can be considered in case tax is not the deciding factor in using offshore funds or an offshore trust.

Expatriate insurance and offshore funds are based on the same priciple,they are both professionaly managed and keep well diversified portfolios.

To be considered as an offshore fund the first thing that is needed is being incorporated in an offshore country and only except investors which do not live in that particular country.Most of these funds pay almost no taxes in there country of incorporation but they can receive dividends or interest on funds which are invested in their jurisdiction..

Since there is an increase in the purchasing power through pooling money with other investors through an investment fund, the investor has potential exposure to a far broader portfolio of investments than would otherwise be affordable with his level of investment commitment.

Limitation on Erisa Assets Investment in a Hedge Fund. Erisa Plan

admin — Wed, 05 Nov 2008 17:31:03 +0000

www.turnkeyhedgefunds.com

What is meant by the 25% limitation on ERISA assets investment in a Hedge Fund?

The Departments of Labor Regulation defines the use of ERISA assets. ERISA Assets include self-employed persons, and individual retirement accounts in pooled investment vehicles. Section 403 (a) requires that generally all assets of an employee benefit plan shall be held in Trust by one or more Trustees. Section 3(21) defines a fiduciary to include any person who exercises discretionary authority or control over the management of Plan Assets. Section 404 provides that a fiduciary must discharge responsibilities in accordance with fiduciary standards of care as set forth in Section 404 (a) (1); that is, (a) solely in the interest of the participants and beneficiaries of the plan (b) with the care skill prudence and diligence under circumstances then prevailing that a prudent man acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and would like aims; and (c) with respect to an investment of a Plan Asset, by diversifying the investments of the plan so as to minimize the risk of large losses.

Section 406 also prohibits a fiduciary from causing a plan knowingly or negligently, to engage in prohibited transactions with “parties-in-interest.” A party-in-interest includes the plan sponsor a person providing services to the plan, a person in control of the plan sponsor, a person controlled by any of the forgoing or an employee, affiliate or relative of any of the forgoing. Section 4975 of the Internal Revenue Code imposes excise taxes on “prohibited transaction” the definition of which is similar to the definition of prohibited transactions under 406 of ERISA. Taxes range from 15% of the amount involved each year up to 100% of the amount involved if corrective action is not undertaken within a certain time period. Section 502 (1) of ERISA imposes upon a fiduciary a civil penalty equal to 20% of the amount received from such fiduciary as a result of a settlement agreement or judicial preceding involving a breech of fiduciary duty. Section 406 also prohibits a fiduciary from dealing with plan assets for his own interests or account, acting in any transaction in which his interest are adverse to those of the plan or receiving consideration for his personal account in connection with any transaction involving plan assets. Section 409 imposes personal liability upon a fiduciary who breeches his duties and responsibilities. Section 405 provides that a plan fiduciary may under certain circumstances be liable for a breech of fiduciary responsibility by a co-fiduciary or for improper delegation of investment authority. Section 412 requires that with certain exceptions a plan fiduciary shall be bonded. Section 403 (a) provides that the trustee shall have the exclusive authority and discretion to manage and control the assets of the plan unless the plan provides that the trustee is subject to the discretion of a named fiduciary or the authority is delegated to an investment manager who is either a bank, an insurance company, or registered as an investment advisor under the Investment Advisor Act 1940.

If the assets of the fund are considered plan assets the trustee may have improperly delegated its investment authority unless the managers and general partners of the fund are either named fiduciaries of the ERISA Plan limited partners or properly appointed as an investment manager within the meaning of Section 3 (38) of ERISA. Moreover, unless the fund manager is a bank or insurance company, it must be registered as an investment advisor under the Investment Advisors Act of 1940 to serve as an ERISA Investment manager. Under the regulations, if a retirement plan purchases an equity interest in an entity, underlying assets will be considered plan assets unless (a) the equity interest is a publicly offered security; (b) the equity interest is a security of a registered investment company; (c) The entity is an operating company; or (d) Benefit plan ownership of equity securities is not significant. The underlying assets are not significant where such assets represent less than 25% of the value of the class of equity security of the entity. Thus, for a hedge fund, a significant benefit plan participation would be an investment of 25% or more by a benefit plan investor in the hedge fund.

It is to be noted however, that only an equity investment in an entity can cause an underlying assets of that entity to be plan assets. The acquisition of debt instruments will generally not result in plan asset treatment

ERISA plan

Not under Rule 501(a)(1). Rule 501(a)(1) accredits as ERISA plan that has a fiduciary which is a bank, insurance company or registered investment advisor, or that has total assets in excess of $5 million. The plan, however, may be an accredited investor under a different provision of Rule 501(a).

www.turnkeyhedgefunds.com