Collective Investment Institutions: What are they and what do they consist of?

Start » Blog » Financing » Collective Investment Institutions: What are they and what do they consist of?

If you are looking to invest your money or better manage your savings, think about the collective investment schemes They are your best option for two reasons: first, because of the great professional support that takes care of all management, which will undoubtedly provide you with the peace of mind and security you are looking for. 

The second reason is because the guarantees and the extensive investment alternatives that it offers according to the profile of the investor that will be adapted to their needs, risks and particularities.

Entities must comply with legal requirements established in the collective investment institutions law of financial regulation that requires savings to be channeled responsibly towards a productive investment in order to stabilize markets and protect the investor. 

Let us remember that the collective investment companies They will allow you to invest in any country in the world at a low cost and through the management of professional analysts. To continue; the details.

What are collective investment institutions?

The Collective Investment Institutions their objective is to attract resources from one or more investors through the issuance of indirect financial assets to convert them into direct financial assets or in the acquisition of real assets. 

The entities that manage the collective investment They replace investors in all work related to formation and portfolio management, freeing themselves from the difficulties that they encounter when making the decision to invest your savings

The performance of this collective investment What each member of this society will receive will depend on the different collective results obtained and is proportional to their individual participation.

What types of collective investment exist?

There are different types of collective investment company and they are grouped according to their characteristics and modalities.

The types of collective investment financial institutions of financial character are: 

  • Investment funds.
  • Investment companies.
  • Investment clubs.

These three types of institutions are the ones that invest in assets such as: Treasury bills, company notes, public and corporate bonds, stocks, derivatives, or even other investment funds.

The types of collective investment financial institutions of non-financial character are: 

  • Non-financial investment funds.
  • Non-financial investment companies.
  • Listed Investment Companies in the Real Estate Market.

These types of institutions are those that invest in nonfinancial assets that derives its value from its physical characteristics such as: real estate and vehicles, as well as intellectual property such as patents and trademarks. 

 

Advantages of collective investment institutions

There is no doubt that the Collective Investment Institutions offer a series of benefits for the investor, especially for the small investor who could try to manage his money individually with higher risks and lower returns.

The seven main advantages are:

1.- Security: The first argument is that at collective investment schemes They are given greater security because they are subject to the supervision of the National Securities Market Commission, in addition to the management responsibility that must be complied with by legal provision that minimizes risk and requires investment diversification between different assets.

2.- Tax advantages: the collective investment companies present an advantageous tax treatment in relation to other types of investment due to the elimination of the well-known "tax toll" through which the partners of the collective investment schemes who obtained capital gains from the sale of their shares had to pay taxes. 

3.- Liquidity: the purchase and sale of shares or participations is carried out more easily, simply and without inconvenience, which generates greater liquidity

4.- Profitability: the collective investment schemes offer the possibility of obtaining better and higher profitability despite investing small amounts. 

5.- Diversification: the collective investment companies They allow you to invest small amounts in numerous assets and markets, which would be more difficult if done individually due to the risks that this represents. 

6.- Professionalized management: the fact that an investor entrusts the management of his funds to financial market professionals It is a realistic and efficient option because it guarantees decision-making. better decisions. 

7.- Financial alternatives: Regardless of the investor's profile, there will be a financial institution that suits your needs and particularities and especially that allow you to invest in any type of financial or non-financial asset. 

Conclusion

Alter Finance is a financial institution With which you can forget about the inconveniences or obstacles that banks pose for financing your company or managing your capital. 

If you are looking for the best alternative Alter Finance it's the solution. This firm is a leader in specialized consultancy in Trade Finance and Working Capital Finance and advises large companies and SMEs to have access to global non-bank financial solutions

Because of his great experience, Alter Finance offers you services and solutions for investors, freelancers and for small, medium and large companies.

check with us about the best financial management tools and we will advise you with the best option that will fit your needs.

Leave a Comment

en_GBEnglish