In the relevant laws of the United States, it is called... because it is based on Article 3)1.

An American private equity fund is essentially a private company.

What investors subscribe for is actually the shares it issues.

Like a Smith Fund, it’s just a popular term.

Legally, it is actually called "Smith Capital One Company."

The total share capital is US$3 billion, and investors contribute capital to subscribe for it.

The investment advisor and management team are Smith Capital.

It has fewer regulatory and disclosure requirements than a listed company.

But for fundraising, there are stricter requirements.

For example, the number of investors cannot exceed 100, and it must target specific groups of people.

IPO is not allowed, each investor must be a qualified investor, and there are requirements for investors.

That is, the assets under management shall not be less than US$1 million, or the investor's net assets shall not be less than US$2.1 million.

The Chinese side basically followed the American approach.

Because they need to raise funds for specific groups of people, they are called "private equity" funds in China.

Corresponds to the concept of "public offering" funds.

The public funds in China are more like the concept of "mutual funds" in the United States.

That’s what they call public funds in China and mutual funds in the United States.

According to U.S. regulations, LPs from private equity funds must be purchased.

One of two requirements must be met, that is, either the investment amount exceeds $1 million, or the personal net worth exceeds $2.1 million.

There is no such requirement for mutual funds, and the public can buy small shares for 10 or 20 yuan.

It is different from private equity funds.

In the United States, the investment strategy of mutual funds is relatively passive.

Generally, we only track one index, or make some weight preferences on the index, which is called index enhancement.

There are very few active public offerings like the one Peter Lynch ran at Fidelity.

Now in the twenty-first century.

Because of the advantages of good liquidity and low fee rates, ETFs are rising rapidly.

The mutual fund business is also not what it used to be.

The regulations and requirements on mutual funds in the United States are more stringent than those in China.

More importantly, those mutual funds in the United States are, strictly speaking, the real ballast of this country's economy.

In the United States, there are more than fifteen mutual funds with a scale exceeding one trillion US dollars!

There are thirty or forty mutual funds worth hundreds of billions of dollars.

More than 40% of households in the United States hold various investment funds.

The richest handful are engaged in private equity.

But most of the middle class and decent families invest in mutual funds.

With such a huge number of users.

In addition, mutual funds in the United States have a history of seventy years.

After more than seventy years of accumulation, a large number of large-scale mutual funds have been accumulated.

Most of the funds of these large-scale mutual funds are circulated in U.S. stocks and U.S. bonds.

One-third of U.S. stocks and one-half of U.S. bonds are purchased by these mutual funds.

This is why U.S. stocks or U.S. bonds have completely collapsed.

The reason why the United States will basically collapse.

Imagine that the investments and savings of the richest and most elite 40% of families in a country were wiped out in one fell swoop.

What is this concept?

Because of this, the United States has stricter requirements for mutual fund management than China.

This is also the reason why the four major investment banks, such as commercial banks and investment banks, often rarely involve mutual funds.

The supervision is too strict, the fees are low, and you can't earn a few commissions for your hard work.

They have ETFs or private equity that are faster and more profitable, and are not in the mood to manage mutual funds.

In the United States, a private equity fund needs to be established.

The speed can be very fast because there is no supervision. As long as someone subscribes to become a shareholder, one can be established in a few days.

When it comes to setting up a mutual fund, the requirements are even more perverted than in China.

The review alone takes almost half a year or even one to two years.

But there are also advantages to being a mutual fund, that is, it is easy to gain favor from the top 40% of families in the country.

Why is Peter Lynch called a stock angel?

It is because the mutual funds he managed back then made a lot of profits for a large number of middle class people in the United States.

In China, the person who makes money for everyone is called the God of Wealth.

In the United States, those who make money for everyone are called angels.

Mutual funds, Abel will also do it in the future.

And after tonight, he will even announce it in the newspaper: Shi

Mies Capital will build a mutual fund from scratch.

The reason why he did this was because he wanted to be like Peter Lynch.

Get the support of the most important 40% of families in this country.

This is also the meaning of what he said in his speech just now, "I want to share my talents with every American."

But to set up a mutual fund and pass various reviews, it can take up to half a year from scratch.

This is when everything goes well.

He was in no hurry at all.

What is urgent are the ordinary middle-class investors who want to invest in him.

Before that, he could create several other private equity funds.

While continuing to make money, continue to seduce Wall Street.

This is what he meant when he said "create a few more fund companies" above.

Simply put, a private equity fund in the United States is equivalent to a company.

David nodded immediately: "No problem. Then when they ask me later, I can give them an explanation!"

The two quickly concluded their discussion. Within a few minutes, Abel had already decided on the number of new fund companies and the total share capital.

After the negotiation was concluded, David Mellon took action immediately.

David came to the high platform again, holding the microphone and smiling.

The lights at the reception also dimmed accordingly.

The spotlight shone on David, who smiled and said:

"Let me tell you some good news. Smith Capital will re-establish five fund companies in the future."

"The total equity capital of each fund company is US$3 billion."

"If anyone wants to be our LP, you can contact me or Smith Capital later~"

"In addition, starting tomorrow, Smith Capital will submit an application to register a mutual fund to the relevant departments."

"As our great Mr. Abel Smith said."

"Smith Capital is willing to share success with any American!"

David's return to the stage and the announcement.

It triggered even more enthusiastic applause than when Abel went up to give a speech just now.

This is not because David is more popular than Abel.

It's because Abel's speech, although it was very good (after all, the lines were designed by the think tank), was quite inflammatory.

But that has nothing to do with them. The guests present are all wealthy people.

Only a very small part of them have joined Smith Fund I.
To be continued...