What is a qualified and professional investor? Know the difference
Do you know what a qualified investor and a professional investor are? Learn about the characteristics of each and the main differences
Announcements
In the world of investments, there is a different classification for qualified and professional investors.
And if you intend to become a great investor in the long term and diversify your portfolio, you need to better understand the differences between these two types of investors!
With that in mind, in today’s article, we’ll explain everything about the subject. Continue reading to find out more.
What is a qualified and professional investor?
Qualified investor is a term designated by the Securities and Exchange Commission (CVM) for those who have amounts equal to or greater than R$1 million invested.
However, it is possible to be part of this group with lower financial capital.
The qualified investor must certify the value in writing. Or, he must have a certification accepted by CVM, so that he can receive this classification.
In addition, he also needs to attest that he has the necessary knowledge to deal with the risks involved and make investments that are not offered to common investors.
This concept is used in several countries, with the aim of regulating the market and protecting small investors.
The following may also be considered qualified investors:
• People who work as professional investors;
• Investment clubs, which have a portfolio managed by one or more shareholders considered qualified investors;
• Independent investment agents;
• Securities analysts and consultants;
• Portfolio managers;
• Investors who have been specifically approved for this category.
What certifications are approved by CVM?
One of the requirements to be a qualified investor is to have more than R$1 million in investments.
In this way, it is possible to request the Qualified Investor Term from the broker.
But if you don't have that amount, there is still another way to become a qualified investor, according to CVM instruction 554.
In this case, you must obtain a certification that proves your knowledge of the financial market.
Only tests recognized by the CVM can qualify you as an investor.
See which certifications are valid:
• CGA certificate (third party asset managers);
• CEA Certificate (investment advisors);
• CFP certificate (financial planners);
• CNPI certificates (investment analysts);
• Ancord certificate (independent agents).
By obtaining one of the aforementioned certifications, you will be considered by institutions as a qualified investor.
This way, you will have access to financial products exclusive to this category, that is, products that are not available to ordinary investors.
What is a professional investor?
The Professional Investor is also a category of investors defined by the CVM (Securities and Exchange Commission).
However, he must have at least R$10 million in financial investments and sign a term, with the CVM, recognizing this investor status.
Professional investors have access to all types of financial investments. In fact, this is one of the characteristics that differentiates them from other companies and investors, who have some limitations regarding certain types of investment.
But according to CVM instruction number 554, the following can also be considered professional investors:
• Financial institutions and other institutions authorized to operate by the Central Bank of Brazil;
• Insurance companies and capitalization companies;
• Open and closed supplementary pension entities;
• Investment funds;
• Individuals or legal entities that have financial investments worth more than R$10,000,000.00 (ten million reais) and that, additionally, attest in writing their status as professional investors through a specific document, in accordance with Annex 9-A.
• Investment clubs, provided that their portfolio is managed by a securities portfolio manager authorized by the CVM;
• Independent investment agents, portfolio managers, analysts and securities consultants authorized by the CVM, in relation to their own resources
• Non-resident investors.
Source: CVM
What are the main differences between a qualified and professional investor?
The main difference between a qualified and professional investor is the amount invested.
Qualified investors must prove R$1 million in financial investments. Professional investors must have at least R$10 million invested.
Professional investors must sign their own terms, just like qualified investors. In addition, they will have certain benefits over regular investors.
However, both have access to more complex investments.
What applications are aimed at qualified and professional investors?
Due to the amount invested and experience in the financial market, when you become a qualified or professional investor, you will have access to more restricted and exclusive applications on the market.
However, it is also necessary to be aware of the risks involved, as these applications are often considered riskier and have high volatility.
This obviously makes the return potential greater and, consequently, more attractive to investors.
See some types of investments aimed at these two categories:
• Certain real estate receivables certificates (CRI) and agribusiness (CRA);
• Shares of mutual funds for investment in emerging companies (FMIEE);
• Credit rights investment fund (FIDC);
• Overseas investment fund (FIEX);
• Real Estate Investment Funds (FII);
• Equity Investment Funds (FIP)
It is important to mention that some of these financial applications, such as real estate funds and equity funds also have options for other investors.
Higher risk funds or those that require a high minimum investment are, in some situations, only intended for professional investors.
What are the advantages of becoming a qualified or professional investor?
The main advantage is having access to exclusive investments.
These applications tend to be riskier, but they offer a higher profit potential.
Qualified investors can also obtain special conditions from investment banks.
Thus, those who have a bolder profile, that is, they are more tolerant to risks, can diversify their portfolio and explore more financial product options.
Conclusion
In short, we can say that a qualified investor needs to have R$1 million invested, while professionals must have at least R$10 million.
As you have seen, qualified and professional investors have some advantages, such as increased access to different financial products.
In addition, several financial institutions offer advantageous conditions, such as reduced fees and specialized management.
