 |
|
 |
|
 |
|
|
 |
|
 |
|
•
What is an investment?
|
|
An investment may be defined as the purchase of an asset that produces a return proportional to risk over some future period. The investments available for purchase are typically financial assets, but real or tangible assets may be included among the alternative investments. The investor can be an individual, a government, or a corporation. Capital markets are a complex of institutions and mechanisms through which funds for purposes longer than a year are pooled and made available to businesses, government and individuals and through which instruments already outstanding are transferred. Because capital markets deal with the long-term investment, they play a key role in the economy’s capital formation. (Top) Under Bahamian Law a mutual fund is defined as a unit trust, an investment company or a partnership that issues or has equity interests, the purpose or effect of which is the pooling of investor funds with the aim of spreading investment risks and enabling investors in the mutual fund to receive profits or gains from the acquisition, holding, management or disposal of investments. What are the three categories of regulated mutual funds under The Mutual Funds Act 1995?
Authorized (Registered) The Authorized mutual fund is a fund with a minimum equity interest of US$50,000 (or its equivalent in any other currency), its equity interests are listed on a stock exchange (or over-the-counter market) and there is filed with The Commission the prescribed details in respect of its current offering document or prospectus and it is registered with The Commission. Regulated funds have an investment of less than US$50,000 and these can be licensed either directly by a licensed mutual fund administrator or by the Securities Commission. Regulated mutual funds must have its principal place of business or principal office in The Bahamas, must file its current offering document and file an annual audited financial statement with The Securities Commission. Exempt mutual funds have 15 or fewer investors who have the power to remove or appoint operators of the fund or is a fund which is already licensed in a prescribed jurisdiction or is listed on a approve Stock Exchange. These exempt funds are for the time being exempted from most statutory filing requirements. Certificates are issued to Exempt Mutual Funds in this jurisdiction. (Top) How can I pick an investment advisor and check their background? When choosing an investment advisor, it may be helpful to get a professional opinion from your lawyer, stockbroker or accountant. Also you can perform your own research into the company of the firm of which the advisor is a member. Who are mutual fund administrators? Mutual Fund Administrators are those involved in the management or administration of a mutual fund or its assets. They provide the principal office of the Mutual Fund. Administrators include those who provide an operator to the Mutual Fund. Directors and Trustees or general partners are all operators. They provide the administrative services of the Fund, which includes accounting, valuation and reporting services. (Top) What can I do if my advisor is not properly managing my investments? Document all activities, and keep a record of all transactions – details of irregular activities and poor working methods can be acted upon swiftly, if there is sound evidence to support the accusations. Report the advisor to the firm when he is employed. If this is not successful, the Securities Commission can be contacted. Is a particular firm/individual registered with the Commission? A list of names of all current and former broker-dealers, traders, facilities and associated persons registered with the Securities Commission are kept in the Official Register, sect 28 (1). Written requests for this information may be submitted to the Commission. (Top) What are material changes that require an Administrator to report them to the Securities commission? As given in the Securities Industries Act 1999 - “material change in reference to the affairs of an issuer is a change in the ownership, operations or capital of the issuer that would reasonably be expected to have a significant effect on the market price or value of any of the securities of the issuer and includes a decision to implement such a change made by the board of directors or by senior management of the issuer who believe that confirmation of the board of directors is probable”. When can a Mutual fund Administrator’s License be revoked? An Administrator’s License may be revoked when the holder has ceased to carry on business, when the holder has been placed in liquidation or dissolution or is in breach of requirements as outlined in the Mutual Fund Act/Regulations 1995. (Top) What documents does the Commission upon liquidation of a fund require? Certificate of Dissolution
|