Investment companies are companies that are engaged in investment activities, that is, attracting free funds in the capital market. The capital of such companies is usually represented by securities.
Investment company concept
Investment companies are a relatively new type of financial institution for Russia. This is not surprising, since investment companies can function normally only in a market economy.
Unlike investment funds, companies only deal with securities. They are engaged in the accumulation of funds and their subsequent profitable investment. Investment companies usually issue their own shares. The funds received from their sale are invested in the shares of enterprises. Accordingly, the income of shareholders of investment companies directly depends on how wisely the funds will be invested. A very popular way of investing in Russia is investing in construction companies.
Also, investment funds can be invested in stocks and bonds of various economic enterprises. Investors' financial risks are significantly reduced, because when the value of some securities falls, the price of others rises. An important advantage for the investor is getting the services of a financial manager, which is the investment company. It turns out that an investor takes risks only with the wrong choice of an investment company.
Signs of a reliable investment company
When choosing an investment company, you should be guided by certain criteria that will allow you not to make a mistake. A reliable investment company must be licensed to carry out dealer, brokerage and securities management activities. Such a license can only be issued by the Federal Service for Financial Markets. A distinctive criterion of a reliable investment company can be considered its long duration of work - at least since 2008.
Having substantial funds is an important sign of a good investment company. In addition, investment companies should not promise returns that are several times higher than the average. Information about the company's investments should not be hidden from investors. An important advantage of any investment company is investing in a group of its own companies. In this case, you will not have to constantly monitor the dynamics of prices, look for some pitfalls and be afraid of political risks.
