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An investor is a person who allocates financial capital with the expectation of a future return (profit) or to gain an advantage (interest). Through this allocated capital the investor usually purchases some species of property. Types of include , debt, securities, , , , , , derivatives such as put and call options, , , etc. This definition makes no distinction between the investors in the and . That is, someone who provides a business with capital and someone who buys a stock are both investors. An investor who owns stock is a .

Types of investors
There are two types of investors: and institutional investors.

A retail investor is also known as an individual investor.

There are several sub-types of institutional investor:

  • making investments on behalf of employees
  • that make investments, either directly or via a captive fund
  • used by universities, churches, etc.
  • , , and other funds, ownership of which may or may not be (these funds typically pool money raised from their owner-subscribers to invest in securities)
  • Sovereign wealth funds
  • Large money managers

Investors might also be classified according to their . In this respect, an important distinctive investor psychology trait is .

Investor protection through government
Investor protection through government involves regulations and enforcement by government agencies to ensure that market is fair and fraudulent activities are eliminated. An example of a government agency that protects investors is the U.S. Securities and Exchange Commission (SEC), which works to protect reasonable investors in the .

Similar protections exist in other countries, including the where individual investors have certain protections via the Financial Services Compensation Scheme (FSCS).

Investment tax structures
Company are paid from , which has the tax already deducted. Therefore, shareholders are given some respite with a preferential tax rate of 15% on "qualified dividends" in the event of the company being domiciled in the United States. Alternatively, in another country having a treaty with the US, accepted by the Internal Revenue Service (IRS). Non-qualified dividends paid by other foreign companies or entities; for example, those receiving income derived from interest on bonds held by a mutual fund, are taxed at the regular and generally higher rate of income tax. When applied to 2013, this is on a sliding scale up to 39.6%, with an additional 3.8% surtax for high-income taxpayers ($200,000 for singles, $250,000 for married couples).

Role of the financier
A financier () is a person whose primary occupation is either facilitating or directly providing investments to up-and-coming or established and , typically involving large sums of money and usually involving and , mergers and acquisitions, , corporate finance, investment banking, or large-scale . A financier makes money through this process when his or her investment is paid back with interest,Xavier Freixas, Jean-Charles Rochet, Microeconomics of Banking (2008), p. 227. from part of the company's equity awarded to them as specified by the business deal, or a financier can generate income through commission, performance, and management fees. A financier can also promote the success of a financed business by allowing the business to take advantage of the financier's reputation. The more experienced and capable the financier is, the more the financier will be able to contribute to the success of the financed entity, and the greater reward the financier will reap. The term, financier, is , and derives from or payment.

Financier is someone who handles money. Certain financier avenues require degrees and licenses including venture capitalists, hedge fund managers, trust fund managers, , , financial advisors, or even public . Personal investing on the other hand, has no requirements and is open to all using the or by word-of-mouth requests for money. A financier "will be a specialized financial intermediary in the sense that it has experience in the type of firm it is lending to".

Economist has argued that the financier plays a role in directing capital to investments that governments and social organizations are constrained from playing:

The concept of the financier has been distinguished from that of a mere capitalist based on the asserted higher level of judgment required of the financier. However, financiers have also been mocked for their perceived tendency to generate wealth at the expense of others, and without engaging in tangible labor. For example, humorist George Helgesen Fitch described the financier as "a man who can make two dollars grow for himself where one grew for someone else before".

See also

Further reading

External links
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