Some of the links on this site are affiliate links.
When it comes to investing, individuals and entities often strive to meet certain criteria to gain access to exclusive opportunities.
While many are familiar with the concept of accredited investors, there exists a group that surpasses these requirements.
Known as qualified purchasers, they hold an elevated status in the investment world, allowing them access to a broader range of investment opportunities.
In this article, we will delve into the realm of qualified purchasers, examining their definition, eligibility criteria, and the advantages they enjoy over accredited investors.
Qualified Purchasers vs. Accredited Investors
Unlike accredited investors, whose qualification is primarily based on net worth or income, qualified purchasers are defined based on their investment holdings.
Eligibility Criteria for Qualified Purchasers
To be recognized as a qualified purchaser, an individual or entity must meet specific requirements outlined by the law.
These conditions encompass various scenarios, including:
- Individual Investors: A person with $5 million or more in investments, either independently or jointly with their spouse. The value of their primary residence or business property is excluded from this calculation.
- Family Investments: A family with $5 million or more in investments, facilitated through a charity, company, estate, or a trust established for their benefit.
- Qualified Purchaser Trusts: A trust sponsored and managed by qualified purchasers that is not exclusively formed for investing in a particular fund.
- Discretionary Asset Control: An individual with discretionary control over at least $25 million in assets, either for their own account or for others.
- Qualified Purchaser Entities: An entity consisting solely of qualified purchasers.
This article was generated using automation technology, and thoroughly edited and fact-checked by an editor on our editorial staff.