equity investor
A large equity investor does not necessarily mean high quality of management, but the managers of the company will build it up.
That means the size of the equity investor for the potential investor? Whether this indicator is one of the key when choosing a management company, and should it be so? We see a clear trend: the regulator is striving to increase the minimum amount of own funds of professional participants and, in particular, the management companies.
If you look at the equity investor as an indicator of the stability of the investor as a financial institution, then the tightening of the requirements in this question is a kind of filter, blocking off the smaller players. In this sense, the requirements to increase the capital carry a grain of truth. However, the question arises: is it not a large equity misleading private investors?
From the point of view of assessment of banks and insurance companies, for the client there is a direct correlation between the size of the own capital and the reliability of the organization. And rightly so: the Bank and the insurance company own capital guarantee performance of obligations. The situation with the management company is the opposite: the law prohibits the management company guarantee profitability of the proposed investment products, that is, to accept the obligations, providing their own capital.
A client comes to a private investor first of all for the effective management and quality service, because according to the law of the client's money is transferred in trust management and are not the property of the managing company. And the presence of large equity capital does not automatically imply high-quality management: a professional team, competently developed infrastructure and effective risk management.
in solving this issue you need to find a balance: the amount must be reasonable, so that the industry did not go down the wrong path, to increase capital is not has turned into a dangerous race between the managers. After all, if the clients when choosing a management company will start to pay attention to the size of own capital, certainly many control him at once built. And the presence of large capital is inevitably will cause them to manage, and it is sure to lead to a conflict of interest with clients.
