Dafm

INVESTMENT FIRMS

Understanding an Investment Company

An investing company is a company, ( partnership,business trust, corporation or limited liability company) that provides securities and is primarily focused into investing in securities. The main business of an investment company is to hold and manage securities for investment purposes, but they typically offer investors a variety of funds and investment services, which include portfolio management, recordkeeping, custodial, legal, accounting and tax management services.

Financial enterprises are covered by the supervision conducted by the Dutch Authority Financial Market. This supervision focuses on orderly and transparent financial market processes, integrity of relations between market players and due care in the provision of services to clients.

Investment companies are categorized into three basic types:

  1. Mutual funds (legally known as open-end companies);
  2. Closed-end funds (legally known as closed-end companies);
  3. UITs (legally known as unit investment trusts).

Each type has its own unique characteristics. Before purchasing shares of an investment company, you should carefully read all of a fund’s available information, including its prospectus and most recent shareholder report.

A good investment firm can help you to invest in the way that matces long term goals for safety and earnings.
Investment companies are regulated primarily under the Investment Company Act of 1940 and the rules and registration forms adopted under that Act. Investment companies are also subject to the Securities Act of 1933 and the Securities Exchange Act of 1934.