The assumption of risk in anticipation of gain but recognizing a higher than average possibility of loss. The term "speculation" implies that a business or investment risk can be analyzed and measured, and its distinction from the term "investment" is one of degree of risk. It differs from gambling, which is based on random outcomes. Investors can include stock traders but with this distinguishing characteristic: investors are owners of a company which entails responsibilities.
Essential quality
Investor
Investor | Essential quality
Investors are owners of a company which entails responsibilities. Being the prophetess of the God of the Israelites. Sorry. I cannot find the answer based on the context. A prophetess of the God of the Israelites
who was adele spitzeder?
user
German actress, folk singer, and con artist.
assistant
what was she accused of?
user
She was convicted instead of bad accounting and mishandling customers' money.
assistant
where was she born?
user
Berlin
assistant
apart from acting did she have other jobs?
user
Yes, she was a banker.
assistant
which bank?
user
Her own bank
assistant
how did she die?
user
Cardiac arrest
assistant
what was her debut film?
user
Deborah and Mary Stuart.
assistant
we talked about her mishandling money, was it sort of a  scheme?
user
Yes, Ponzi scheme
assistant
what exactly is this scheme?
user
Form of fraud that lures investors and pays profits to earlier investors with funds from more recent investors.
assistant
what is an essential quality for the first person?
user
The assumption of risk in anticipation of gain but recognizing a higher than average possibility of loss. The term "speculation" implies that a business or investment risk can be analyzed and measured, and its distinction from the term "investment" is one of degree of risk. It differs from gambling, which is based on random outcomes. Investors can include stock traders but with this distinguishing characteristic: investors are owners of a company which entails responsibilities.
Investor | Essential quality
Typically, Ponzi schemes require an initial investment and promise above average returns. They use vague verbal guises such as "hedge futures trading", "high-yield investment programs", or "offshore investment" to describe their income strategy. It is common for the operator to take advantage of a lack of investor knowledge or competence, or sometimes claim to use a proprietary, secret investment strategy to avoid giving information about the scheme. The basic premise of a Ponzi scheme is "to rob Peter to pay Paul". Initially, the operator pays high returns to attract investors and entice current investors to invest more money. When other investors begin to participate, a cascade effect begins.
Ponzi scheme | Characteristics
Quality investing is an investment strategy based on a set of clearly defined fundamental criteria that seeks to identify companies with outstanding quality characteristics. The quality assessment is made based on soft (e.g. management credibility) and hard criteria (e.g. balance sheet stability). Quality investing supports best overall rather than best-in-class approach.
Quality investing | Introduction
A Ponzi scheme (, ; also a Ponzi game) is a form of fraud that lures investors and pays profits to earlier investors with funds from more recent investors. The scheme leads victims to believe that profits are coming from product sales or other means, and they remain unaware that other investors are the source of funds. A Ponzi scheme can maintain the illusion of a sustainable business as long as new investors contribute new funds, and as long as most of the investors do not demand full repayment and still believe in the non-existent assets they are purported to own.
Ponzi scheme | Introduction
The receivers of Barlow Clowes, a failed investment management firm, applied to determine in what order they should distribute assets to the creditors in Portfolios 28 and 68. Contributors to these managed investment plan accounts had advanced money, and were aware the money was to be invested as a collective fund. Specific investments were not earmarked for specific investors. In the event, the assets were misapplied and mostly dissipated. Peter Gibson J held that the first in first out rule applied. The early investors appealed, represented by Mr Walker QC.
Vaughan v Barlow Clowes International Ltd | Facts
The schemer pays a "return" to initial investors from the investments of new participants, rather than from genuine profits. Often, high returns encourage investors to leave their money in the scheme, so that the operator does not actually have to pay very much to investors. The operator simply sends statements showing how much they have earned, which maintains the deception that the scheme is an investment with high returns. Investors within a Ponzi scheme may even face difficulties when trying to get their money out of the investment.
Ponzi scheme | Characteristics
Lord Hoffmann set out five principles, so that contract should be construed according to:
Investors Compensation Scheme Ltd v West Bromwich Building Society | Introduction
Quality investing is an investment style that can be viewed independent of value investing and growth Investing. A quality portfolio may therefore also contain stocks with Growth and Value attributes. Nowadays, Value Investing is based first and foremost on stock valuation. Certain valuation coefficients, such as the price/earnings and price/book ratios, are key elements here. Value is defined either by valuation level relative to the overall market or to the sector, or as the opposite of Growth. An analysis of the company's fundamentals is therefore secondary. Consequently, a Value investor will buy a company's stock because he believes that it is undervalued and that the company is a good one.
Quality investing | Comparison to other investment models
Like most Ponzi Schemes, all it requires is a chain of investors with the old members paid hefty returns on their money from the deposits of the new members. The money investors may or may not understand how the scheme works, but quite often they don't care as long as they are getting big profits on their invested money. Everybody wakes up to the facts of the scheme, when the chain is broken by the force of law or due to some other reason. Then the investors, awaiting the big profits, have to pay a big price not only in money but also emotionally.
Double Shah | How the scheme works
The idea for quality investing originated in the bond and real estate investing, where both the quality and price of potential investments are determined by ratings and expert attestations. Later the concept was applied to investments in enterprises in equity markets. Benjamin Graham, the founding father of value investing, was the first to recognize the quality problem among equities back in the 1930s. Graham classified stocks as either Quality or Low Quality. He also observed that the greatest losses result not from buying quality at an excessively high price, but from buying Low Quality at a price that seems good value.
Quality investing | History
In reality, the fraudster almost always steals investor money for personal use. Both types of schemes depend on an unending supply of new investors; when the supply of investors inevitably dries up, the whole scheme collapses and investors discover that most or all of their money is gone.
Affinity fraud | Introduction
The company has been accused of operating a Ponzi fraud scheme, using the money from new investors to pay the returns on previous investments. Many of the approximately 150,000 investors are pensioners for whom investing their savings in rare stamps appeared a more attractive option than placing them in a lower-return bank savings account. Afinsa was not a financial institution. Contrary to equity investment, tangible investments are not protected by a mandatory warranty fund under Spanish law (available only to registered financial institutions, which allowed the victims of the earlier Banesto and Gescartera scandals to recover a small part of their assets).
Afinsa | Fraud allegations
If Portfolio A has an expected return of 10% and standard deviation of 15%, while portfolio B has a mean return of 8% and a standard deviation of 5%, and the investor is willing to invest in a portfolio that maximizes the probability of a return no lower than 0%: By Roy's safety-first criterion, the investor would choose portfolio B as the correct investment opportunity.
Roy's safety-first criterion | Example
Roy's safety-first criterion is a risk management technique, devised by Arthur D. Roy, that allows an investor to select one portfolio rather than another based on the criterion that the probability of the portfolio's return falling below a minimum desired threshold is minimized. For example, suppose there are two available investment strategies—portfolio A and portfolio B, and suppose the investor's threshold return level (the minimum return that the investor is willing to tolerate) is −1%. then the investor would choose the portfolio that would provide the maximum probability of the portfolio return being at least as high as −1%. Thus, the problem of an investor using Roy's safety criterion can be summarized symbolically as:
Roy's safety-first criterion | Introduction
For the buyer, the scheme is offered as a steal, without any levied interest for a specific period, subject to special terms or conditions.
0% finance | Definition
The securities eligible for investments under the scheme are equities listed in BSE 100 or CNX 100, shares of public sector companies categorised by the Government as Maharatna, Navratna, or Miniratna. Select ETFs and Mutual funds, and IPOs of public sector undertakings fulfilling certain criteria, are also eligible.
Rajiv Gandhi Equity Savings Scheme | Eligible securities
As long as new investors keep contributing, earlier ones keep getting a return on their investment and the fraud continues. But eventually, new investors stop contributing and the whole pyramid collapses, with the later contributors getting nothing in return for their investment. As is the case with many Ponzi schemes, Lewis relied on trust and word of mouth to help build his scheme. Many of Lewis' victims were members of churches and church-related groups, of which Lewis was reportedly a member.
James Paul Lewis Jr. | Introduction
In order to stay afloat Ponzi schemes rely on a continuous supply of greater fools who are willing to buy into the scheme. Although a share in such a scheme has no value whatsoever, so long as more greater fools buy into it, it can remain profitable for the investors involved.
Greater fool theory | Examples
The Enterprise Investment Scheme is a tax advantaged scheme designed to help companies that at their early growth stage to raise equity finance from investors. Through this scheme, qualifying investors are able to claim income tax relief of 30%, plus exemption from capital gains tax when enterprise investment scheme shares are disposed of.
Social venture capital | Enterprise Investment Scheme (EIS)
The rules for qualifying are complicated; for example, the following are some of the qualifications that must be met:
Enterprise Investment Scheme | Qualifying companies and individuals
The UK Financial Services Compensation Scheme compensates investors on the failure of an investment firm. However the limit in June 2015 stood at only £50,000 per person per investment firm and losses above this amount would not be covered. This risk of the shares being lost through malfeasance does not apply when the shares are held by the investor in certificated form.
Street name securities | In the United Kingdom
The precise conditions of a SAFE vary. However, the basic mechanics are that the investor provides a certain amount of funding to the company at signing. In return, the investor receives stock in the company at a later date, in connection with specific, contractually-agreed on liquidity events. The primary trigger is generally the sale of preferred shares by the company, typically as part of a future priced fund-raising round. Unlike a straight purchase of equity, shares are not valued at the time the SAFE is signed. Instead, investors and the company negotiate the mechanism by which future shares will be issued, and defer actual valuation.
Simple agreement for future equity | Mechanics
A get-rich-quick scheme is a plan to obtain high rates of return for a small investment. The term "get rich quick" has been used to describe shady investments since at least the early 20th century. Most schemes create an impression that participants can obtain this high rate of return with little risk, and with little skill, effort, or time. Get-rich-quick schemes often assert that wealth can be obtained by working at home. Legal and quasi-legal get-rich-quick schemes are frequently advertised on infomercials and in magazines and newspapers. Illegal schemes or scams are often advertised through spam or cold calling. Some forms of advertising for these schemes market books or compact discs about getting rich quick rather than asking participants to invest directly in a concrete scheme.
Get-rich-quick scheme | Introduction
Second, in terms of integrity, the SEC had to get rid of the penny ante swindles based on false information, fraudulent devices, and unsound get-rich-quick schemes. Thirdly, and much more important than the frauds, the SEC had to end the million-dollar insider maneuvers in major corporations, whereby insiders with access to information about the condition of the company knew when to buy or sell their own securities. Finally, the SEC had to set up a complex system of registration for all securities sold in America, with a clear-cut set of rules and guidelines that everyone had to follow. By mandating the disclosure of business information and allowing investors to make informed decisions, the SEC largely succeed in its goal of restoring investor confidence.
Presidency of Franklin D. Roosevelt, first and second terms | Securities regulation
For a scheme with less than 90% of the assets required, the scheme had to pay the shortfall below 90% within three years. Where the scheme was between 90% and 100%, the period was ten years.
Minimum funding requirement | Introduction
The level of discount was greatly reduced, and although in theory the scheme is fairer, in practice many students and parents were left out of pocket.
First Capital Connect | Fares
These indirect methods reduce the control participating individuals have over what they buy. The scheme can cover fields such as: If you are awarded the grant you will not be paid in cash or into a bank account. Instead it will be:
Essential Living Fund | Introduction
Operators generally set up a website offering an "investment program" which promises very high returns, such as 1% per day (3678% APY when returns are compounded every day), disclosing little or no detail about the underlying management, location, or other aspects of how money is to be invested. The U.S. Securities and Exchange Commission (SEC) has said that "these fraudulent schemes involve the purported issuance, trading, or use of so-called 'prime' bank, 'prime' European bank or 'prime' world bank financial instruments, or other 'high yield investment programs.' (HYIP's) The fraud artists … seek to mislead investors by suggesting that well regarded and financially sound institutions participate in these bogus programs." In 2010, the Financial Industry Regulatory Authority (FINRA) warned that "[t]he con artists behind HYIPs are experts at using social media — including YouTube, Twitter and Facebook — to lure investors and create the illusion of social consensus that these investments are legitimate." Though Ponzi schemes have existed since at least the early 1900s, the rise of digital payment systems has made it much easier for operators of such websites to accept payments from people worldwide.
High-yield investment program | Mechanics
In 2006, Canadian securities regulators commissioned two national investor surveys to gauge people's knowledge and experience with investments and fraud. The results from both studies demonstrated there is a need better to educate and inform investors about capital markets and investment fraud. Education in this area is particularly important as investors take on more risk and responsibility of managing their retirement savings, and a large baby boomer population enters the retirement years across North America. In 2005, the British Columbia Securities Commission (BCSC) funded the Eron Mortgage Study. It was the first systematic study of a single investment fraud, focusing on more than 2,200 Eron Mortgage investors.
Financial literacy | Canada
These include, for example, "In Search of Excellence" by Thomas Peters and Robert Waterman, "Competitive Advantage" by Michael Porter, " " by Jim Collins and Jerry Porras, and "Good to Great" by Jim Collins.
Quality investing | History
s 708(8) of the Corporations Act 2001 is found in Chapter 6D (Fundraising). It defines "sophisticated investor" so as to exclude them from certain disclosure requirements. That section provides for an accountant to issue a certificate stating that an individual meets the criteria prescribed in the "Corporations Regulations 2001", namely net assets of at least $2.5 million, or a gross income for each of the last two financial years of at least $250,000. There is a second definition of "sophisticated investor" in s 761GA of the Corporations Act 2001 in Chapter 7 (Financial services and markets). It defines sophisticated investors so that they can be treated as wholesale (rather than retail) clients.
Accredited investor | Australia
This is referred to as a pump and dump scheme. The pump and dump is a form of microcap stock fraud. In more sophisticated versions of the fraud, individuals or organizations buy millions of shares, then use newsletter websites, chat rooms, stock message boards, press releases, or e-mail blasts to drive up interest in the stock. Very often, the perpetrator will claim to have "inside" information about impending news to persuade the unwitting investor to quickly buy the shares. When buying pressure pushes the share price up, the rise in price entices more people to believe the hype and to buy shares as well.
Securities fraud | Microcap fraud
In the second scheme, the defendants perpetrated their fraud through their management of the liquidation of Aegis Capital, a North Carolina-based investment fund. Instead of returning investment proceeds to investors, Lakian and Lamm diverted more than $2 million of investors' money to themselves and to restaurant businesses they controlled. He has been charged with investment and bank fraud. According to Robert L. Capers, United States Attorney for the Eastern District of New York, "The defendants played a confidence game, stealing investors' hard-earned money through lies and deceit to use for their own purposes". "We remain steadfast in our commitment to the investigation and prosecution of those who prey on investors and enrich themselves by means of financial fraud."
John Lakian | Legal issues
In times of hyper-inflation and in remote regions the price of necessities is so exorbitant that relative to normal markets these prices may seem arbitrary. Yet the local cost of doing business relative to the price in these regions, as well as the necessity to feed and shelter one's self in a hyper-inflationary crisis, justifies through profit or actual benefit the "foolish" price. In real estate, the greater fool theory can drive investment through the expectation that prices always rise. A period of rising prices may cause lenders to underestimate the risk of default. A Ponzi scheme is a form of investor fraud where earlier investors are paid from the money gained by more recent investors.
Greater fool theory | Examples
A flight-to-quality, or flight-to-safety, is a financial market phenomenon occurring when investors sell what they perceive to be higher-risk investments and purchase safer investments, such as gold and other precious metals. This is considered a sign of fear in the marketplace, as investors seek less risk in exchange for lower profits. Flight-to-quality is usually accompanied by an increase in demand for assets that are government-backed and a decline in demand for assets backed by private agents.
Flight-to-quality | Introduction
I have received a large amount of high-quality treatment without which I would not have survived."
Investor's Business Daily | Errors and retractions
The companies were associated with Quality Sports Jersey GP Limited (QSI GP) and Quality Sports II Jersey GP Limited (QSI II GP). QSI GP and QSI II GP were 50% owned by CAA. Unlike Portuguese football investment funds (which were regulated by Alternative Investment Fund Managers Directive 2011), the EPRAs was not treated as an intangible asset, and so there is no amortization nor write-down as a case of tangible asset. The fund even inserted clause in the EPRA, such that even if the player was released as a free agent, the fund would received the original purchase price paid to the club, plus 10% interest p.a..
Quality Sports Investments | Quality Football Ireland
Quality investors, meanwhile, favor stocks whose high earnings growth is rooted in a sound fundamental basis and whose price is justified.
Quality investing | Comparison to other investment models
s 5 of the Securities Act (1978) defines a sophisticated investor in New Zealand for the purposes of subsection (2CC)(a), a person is wealthy if an independent chartered accountant certifies, no more than 12 months before the offer is made, that the chartered accountant is satisfied on reasonable grounds that the person (a) has net assets of at least $2,000,000; or (b) had an annual gross income of at least $200,000 for each of the last two financial years. There is a further section that follows stating that an eligible investor (experienced or sophisticated) is one who has satisfied a financial investor that they meet certain criteria.
Accredited investor | New Zealand
There are inherent concerns that individuals should be aware of when investing in penny stocks, namely the lack of information that often exists surrounding the companies offering said stocks. The lack of public reporting mixed with a thin market is often the perfect recipe for stock manipulation via stock promoters. A common practice is for these individuals to purchase large quantities of stock and then utilize promoters to artificially inflate the sub-penny stock’s share price, through false and misleading information. When the liquidity and price increase the manipulator will sell their stock, this is called a “pump and dump” scheme which is a form of microcap stock fraud.
Penny stock | Concerns for investors
Investor protection also includes fairness of the market which means all participants in the market have access to the same information.
Investor | Investor protection
Classic economic theory maintains that people are rational and averse to risk. They, therefore, need an incentive to accept risk. The incentive in finance comes in the form of higher expected returns after buying a risky asset. In other words, the more risky the investment, the more return investors want from that investment. Using the same example as above, assume the first investment opportunity is a government bond that will pay interest of 5% per year and the principal and interest payments are guaranteed by the government. Alternatively, the second investment opportunity is a bond issued by small company and that bond also pays annual interest of 5%.
Valuation (finance) | Discounted cash flow method
Under normality, The Sharpe ratio is defined as excess return per unit of risk, or in other words: The SFRatio has a striking similarity to the Sharpe ratio. Thus for normally distributed returns, Roy's Safety-first criterion—with the minimum acceptable return equal to the risk-free rate—provides the same conclusions about which portfolio to invest in as if we were picking the one with the maximum Sharpe ratio.
Roy's safety-first criterion | Similarity to Sharpe ratio
First Sentier Investors has been a signatory to the United Nations' Principles for Responsible Investment (also referred to as PRI) since 2007 and produce an annual report.
First Sentier Investors | Responsible Investment
A tobashi scheme is a financial fraud through creative accounting where a client's losses are hidden by an investment firm by shifting them between the portfolios of other (genuine or fake) clients. Any real client with portfolio losses can therefore have their accounts flattered by this process. This cycling cannot continue indefinitely and so the investment firm itself ends up picking up the cost. As it is ultimately expensive there must be a strong incentive for the investment firm to pursue this activity on behalf of their clients.
Tobashi scheme | Introduction
A Ponzi scheme is an investment fund where withdrawals are financed by subsequent investors, rather than profit obtained through investment activities. The largest instance of securities fraud committed by an individual ever is a Ponzi scheme operated by former NASDAQ chairman Bernard Madoff, which caused up to an estimated $64.8 billion in losses depending on which method is used to calculate the losses prior to its collapse.
Securities fraud | Ponzi schemes
However, the vast majority of them offer their services for free. Buyers of worthless shares of stock are sometimes approached with schemes to revive the original bankrupt companies. All the victim needs to do to save his original investment is to contribute so much per share. This throwing of good money after bad appeals to those reluctant to admit that they made a bad investment.
Reloading scam | How the scam works
Investor protection through individual is the strategy that one utilizes to minimize loss. Individual investors can protect themselves by purchasing only shares of businesses that they understand, or only those that remain calm through market volatility. An individual investor may be protected by the strategy he uses in investment. The strategy includes an appropriate price of the stocks or assets in the right time he enters. It's hard to fix what "an appropriate price" is, and when it is appropriate because no one makes a purchase or a sale absolutely in his most favorable situation. However, determination may be made when the price of such share or assets are "undervalued" comparing to its potentiality.
Investor | As individuals
A must on every investor’s reading list.”
Survival of the Fittest for Investors | Reception
In some ways this model is similar to a pyramid scheme, but Clarke counters that a vital difference is that nobody would be promised a return on their investment. He argues that regardless of any profits, each patron would have the satisfaction of knowing that they supported an artist whose work they appreciate. Also, earlier investors would profit more, thus rewarding them for investing in artists before they became more popular. The early investors would serve a similar role to studios' talent scouts.
FairShare | Introduction
According to an article in "The Globe and Mail", the permanent portfolio approach is more of an "investment idea" rather than an "exact blueprint" for an investor's portfolio.
Fail-Safe Investing | Reception
In reality, Ponzi was paying earlier investors using the investments of later investors. While this type of fraudulent investment scheme was not originally invented by Ponzi, it became so identified with him that it now is referred to as a "Ponzi scheme." His scheme ran for over a year before it collapsed, costing his "investors" $20 million. Ponzi may have been inspired by the scheme of William F. Miller (also known as "520% Miller"), a Brooklyn bookkeeper who in 1899 used a similar deception to take in $1 million.
Charles Ponzi | Introduction
Consequentially, in order for the companies turn a profit, investors felt that the Communists would need to lose the election. The auctions were rigged and lacked competition, being largely controlled by favored insiders with political connections or used for the benefit of the commercial banks themselves. The scheme was structured in a manner that made Yeltsin's victory a strong interest of the investors involved. The two-stage program was structured so that the loans would be made before the election, but the auction of the shares could only take place after the election, making it of financial concern for them that Yeltsin would win the election.
Loans for shares scheme | Introduction
Investors received negligent advice from their financial advisers, solicitors and building societies, including West Bromwich Building Society ('West Bromwich BS'). They had claims in tort and for breach of statutory duty. The investors had been encouraged by financiers to enter "Home Income Plans", which meant mortgaging their properties to get cash that they would put into equity linked bonds. They lost money when house prices and stocks fell. Under the Financial Services Act 1986 section 54 the Securities and Investments Board started the Investors Compensation Scheme Ltd, where investors could be directly compensated for their losses, and ICS would try recoup the cost by suing the building societies on everyone’s behalf.
Investors Compensation Scheme Ltd v West Bromwich Building Society | Facts
Such training material is typically in the form of e-books or training CDs. These schemes rarely work since the material sent to victims is frequently just basic or intermediate marketing material that is neither secret nor a guarantee to making a lot of money online. Often, the initial materials include heavy promotion of expensive seminars or classes, with the implication that not purchasing these items means the reader is not "serious" or "ready to make money". Sometimes buying the materials subscribes the purchaser to a newsletter (or other communication) whose cost is automatically deducted from the bank account used to make the purchase each month; typically this condition is buried in the fine print, and cancelling the subscription is extremely difficult.
Get-rich-quick scheme | Online schemes
The first person to trust him was his next-door neighbour who owned a marble business named Javed Marble Factory. He was followed by many of Shah’s colleagues. As promised, their investments were indeed doubled in 15 days. This was a Ponzi scheme where investors were offered 100% return on their investment in just 15 days, later extended to 70 days. Residents of Gujranwala, Gujrat, Wazirabad, Sialkot and Hafizabad were the cities where most of his clients were.
Double Shah | Early life
Small investors are usually excluded from these investment opportunities, because clap notes tend to have face values in the range of hundreds of thousands of dollars. Also, they are normally only offered to insiders—persons who have invested with the particular entity in the past. The very structure of the note encourages the investor to reinvest the full face value for additional tax savings if another note is available for investment. In the U.S., this tax saving strategy is accomplished by what is known as a 1031 Exchange. The IRS allows the investor to defer payment of any taxes on the profit made on the “second hand” (in the case of the above example, that would be $10,000) indefinitely into the future if the investor “exchanges” the investment for a similar one, which, in practice, means that the investor could buy another clap note with a face value of $111,111, thus instantly saving about $3,300 in taxes and simultaneously making another $11,111 in profit on his original investment of $90,000.
Clap note | Exclusivity
Many penny stocks, particularly those that trade for fractions of a cent, are thinly traded. They can become the target of stock promoters and manipulators. These manipulators first purchase large quantities of stock, then drive up the share price through false and misleading positive statements, and then sell their shares at a large profit. This is referred to as a "pump and dump" scheme. The pump and dump is a form of microcap stock fraud. In more sophisticated versions of the fraud, individuals or organizations buy millions of shares, then use newsletter websites, chat rooms, stock message boards, press releases, or e-mail blasts to drive up interest in the stock.
Microcap stock fraud | Pump and dump
The term "collective investment scheme" is a legal concept deriving initially from a set of European Union Directives to regulate mutual fund investment and management. The Undertakings for Collective Investment in Transferable Securities Directives 85/611/EEC, as amended by 2001/107/EC and 2001/108/EC (typically known as UCITS for short) created an EU-wide structure, so that funds fulfilling its basic regulations could be marketed in any member state. The basic aim of collective investment scheme regulation is that the financial "products" that are sold to the public are sufficiently transparent, with full disclosure about the nature of the terms. In the United Kingdom, the primary statute is the Financial Services and Markets Act 2000, where Part XVII, sections 235 to 284 deal with the requirements for a collective investment scheme to operate.
Investment fund | Law
In the UK a first trial over VAT fraud in the carbon market is put on track to start in February 2012.
European Union Emission Trading Scheme | VAT fraud
For an investor who wants to purchase an income stream that rises with average incomes, but does not want the volatility of the stock market, they could be attractive. A committee in the UK which looked at where people would ideally save, concluded that ideal pensions would be linked to average incomes prior to retirement and to inflation after retirement. These instruments also provide an investor with the opportunity to speculate on a country's increase in GDP if they have a more favorable view of the country's prospects relative to other market participants.
GDP-linked bond | Advantages for the investor
The RQFII scheme applies to the following instruments:
RMB Qualified Foreign Institutional Investor | Available Instruments
A quality investor, meanwhile, will buy a company's stock because it is an excellent company that is also attractively valued. Modern Growth Investing centers primarily on Growth stocks. The investor's decision rests equally on experts' profit forecasts and the company's earnings per share. Only stocks that are believed to generate high future profits and a strong growth in earnings per share are admitted to a Growth investor's portfolio. The share price at which these anticipated profits are bought, and the fundamental basis for growth, are secondary considerations. Growth investors thus focus on stocks exhibiting strong earnings expansion and high profit expectations, regardless of their valuation.
Quality investing | Comparison to other investment models
The fraud-on-the-market theory is the idea that stock prices are a function of all material information about the company and its business. It applies in open and developed securities markets, where it can be assumed that all material information is available to investors. The theory states that under these conditions, there is a causal link between any misstatement and any stock purchaser, because the misstatements defraud the entire market and thus affect the price of the stock. Therefore, a material misstatement's effect on an individual purchaser is no less significant than the effect on the entire market. The question before the court was whether this entitles an individual stock purchaser a presumption of reliance, even if the purchaser did not directly rely on the misstatements.
Basic Inc. v. Levinson | Reliance and the fraud-on-the-market theory
The Court of Appeal held that contributors could not have intended that withdrawals from the account, and investments then purchased, could be allocated by reference to the order the contributions were made. So the first in first out rule is more of a default rule. It would not be applied if the result would be ‘impracticable or result in injustice’. It was not intended that only a small number of investors would get the most out of the fund. They would share rateably, "pari passu". Dillon LJ said the following: Dillon LJ also noted that in "The Mecca" Lord Halsbury LC said, ‘the circumstances of a case may afford ground for inferring that transactions of the parties were not so intended as to come under this general rule’ of "Clayton's Case".
Vaughan v Barlow Clowes International Ltd | Judgment
The company presented itself as an invitation-only foreign exchange investment club that required an initial investment of several thousand euros while promising up to 4-fold returns. As a proof of concept for its members it offered an automatic "signal clock" software which was said to predict good times to buy or sell a currency. Members for the new club were acquired at presentation meetings, to which current members were encouraged to bring friends, who could then in turn be persuaded into investing in the club. The importance of respect and loyalty to the club were underlined in its rules. The "investors' club" was especially popular on several web forums.
WinCapita | Scheme
Investors in People is a standard for people management, offering accreditation to organisations that adhere to the Investors in People Standard. From 1991 to January 2017, Investors in People was owned by the UK government. As of 1 February 2017, Investors in People transitioned into the Investors in People Community Interest Company. Investors in People assessments are conducted locally through local Delivery Centres across the UK and internationally.
Investors in People | Introduction
In 1990 the Department of Employment was tasked with developing a national standard of good practice for training and development. Investors in People was born and officially launched at that year's CBI Conference in Glasgow by then Secretary of State for Employment, the Rt Hon Michael Howard QC MP. Investors in People UK was formed in 1991 to protect the integrity of the Investors in People framework. It was a non-departmental public body and received funding from the former UK Department for Business, Innovation and Skills (BIS). The organisation was based in London, United Kingdom and managed the development, policy, promotion and quality assurance of the Investors in People framework.
Investors in People | History
I have now identified the necessary funding to advance this scheme."
Paul Givan | Líofa Bursary Scheme
The first question to be addressed, therefore, is whether the amount obtained by the defendant is an essential element of the crime of general assistance fraud.
State v. Golding | I
He then directed an associate to liquidate the bonds overseas and invest them in stocks, which netted him $16 million in ill-gotten gains.
Robert E. Brennan | First Jersey Securities Fraud
Foster claimed that for every £1 invested, he was earning £28.50, that he had already recruited 50,000 members, and that the scheme held assets of £203m. The highlight of Foster's presentations came when previous investors' names were drawn by lottery, with the lucky winners being paid their promised returns early, in front of the crowd. Further prizes included cars, and even the loan of Foster's Ferrari.
Kevin Foster (fraudster) | History
The victim is guaranteed a certain income, benefits or employment. To get this they first have to buy something like a business plan, start-up materials, or software. They may be asked to pay to be put on a directory to "guarantee" jobs. This is merely a way to get the victim to spend money – no job awaits.
Employment fraud | Guaranteed employment/income scams
In a Ponzi scheme, a single operator benefits, while in a pyramid scheme, many investors benefit from recruiting other investors. The SFO has cited the KF Concept case as an example of one of its successful ponzi scheme prosecutions, where a banker was jailed for 10 years for running an unauthorized investment business and defrauding investors of amounts over £17 million. The SFO also prosecutes multiple types of corporate fraud. The SFO website as of 2013 outlined several types of fraud it classified as corporate, including asset stripping, which involved company directors taking company funds or assets of value while leaving behind the debts.
Serious Fraud Office (United Kingdom) | Fraud
provides: For the purposes of this chapter, the term "scheme or artifice to defraud" includes a scheme or artifice to deprive another of the intangible right of honest services.
Mail and wire fraud | Honest services
The simplest upwind scheme possible is the first-order upwind scheme. It is given by
Upwind scheme | First-order upwind scheme
Writing in the "Washington Post", Ezra Klein said that the bill had some good ideas but that it would not work. In particular he said "its version of the health insurance exchanges will collapse pretty quickly because the bill contains He said "In other words, this looks much like the reforms that collapsed in Texas, and in California. Price isn't learning from past policy mistakes, and so he means to repeat them." The good elements, he said, were its proposal for automatic enrollment (of employees in employer health care schemes) and the extension of tax exemption on the purchase of private insurance by buyers in the individual insurance market currently enjoyed by the employed.
Empowering Patients First Act | Critical reaction
However, as the Law Commission of England and Wales has noted: "At a time when investment in equities may be the only way in which the capital value of the fund can in fact be maintained the traditional theory that re-investment is necessary to protect those interested in the capital no longer holds good."
Howe v Earl of Dartmouth | Modern application
Investors might also be classified according to their styles. In this respect, an important distinctive investor psychology trait is risk attitude.
Investor | Institutional investor
This is a list of Ponzi schemes, fraudulent investment operations that pay out returns to investors from money paid in by subsequent investors, rather than from any actual profit earned from the operation of a business.
List of Ponzi schemes | Introduction
"Pump and dump" (P&D) is a form of securities fraud that involves artificially inflating the price of an owned stock through false and misleading positive statements, in order to sell the cheaply purchased stock at a higher price. Once the operators of the scheme "dump" (sell) their overvalued shares, the price falls and investors lose their money. This is most common with small cap cryptocurrencies and very small corporations, i.e. "microcaps". While fraudsters in the past relied on cold calls, the Internet now offers a cheaper and easier way of reaching large numbers of potential investors through spam email, bad data, social media, and false information.
Pump and dump | Introduction
In this scheme, any "t" out of "n" shares may be used to recover the secret. The system relies on the idea that you can fit a unique polynomial of degree to any set of "t" points that lie on the polynomial. It takes two points to define a straight line, three points to fully define a quadratic, four points to define a cubic curve, and so on. That is, it takes "t" points to define a polynomial of degree . The method is to create a polynomial of degree with the secret as the first coefficient and the remaining coefficients picked at random.
Secret sharing | Shamir's scheme
Each joiner is required to buy an expensive but potentially worthless item, such as an e-book, for their position in the queue. The scheme organizer profits because the income from joiners far exceeds the cost of sending out the item to the person at the front. Organizers can further profit by starting a scheme with a queue with "shill" names that must be cleared out before genuine people get to the front. The scheme collapses when no more people are willing to join the queue. Schemes may not reveal, or may attempt to exaggerate, a prospective joiner's queue position, a condition that essentially means the scheme is a lottery.
Pyramid scheme | Matrix schemes
An individual then may also have these accounts at other institutions for further diversification.
Canadian Investor Protection Fund | Introduction
The QIP Scheme is open to investments made by “Qualified Institutional Buyers” (which includes public financial institutions, mutual funds, foreign institutional investors, venture capital funds and foreign venture capital funds registered with the SEBI) in any issue of equity shares/ fully convertible debentures/ partly convertible debentures or any securities other than warrants, which are convertible into or exchangeable with equity shares at a later date (Securities). Pursuant to the QIP Scheme, the Securities may be issued by the issuer at a price that shall be no lower than the higher of the average of the weekly high and low of the closing prices of the related shares quoted on the stock exchange (i) during the preceding six months; or (ii) the preceding two weeks.
Qualified institutional placement | QIPs in India and the US
These bonus points build up on only one of the IR's legs. The IR must then find recruits for the other leg in order to receive commissions. Many government entities described Qnet's business model as a pyramid scheme: early entrants earn money, and as the number of Independent Representatives (IRs) increases, finding more IRs to join becomes difficult or impossible; IRs that join late do not earn enough to cover their first outlay and the model collapses.
Qnet | Business model
If the portfolios under consideration have normally distributed returns, Roy's safety-first criterion can be reduced to the maximization of the safety-first ratio, defined by: where formula_6 is the expected return (the mean return) of the portfolio, formula_7 is the standard deviation of the portfolio's return and formula_4 is the minimum acceptable return.
Roy's safety-first criterion | Normally distributed return and SFRatio
Though UK-based, the Standard has been licensed to a number of other countries through Investors in People International. Investors in People International operates in more than 80 countries and delivers services in more than 30 languages.
Investors in People | Investors in People International
The scheme can be availed by Indian residents with an annual income not exceeding Rs: 12 lakhs. In addition, for a person to be eligible, he should not have had a Demat account prior to 23 November 2012, or should only have a Demat account that has never been used to trade. There is a lock in period of three years.
Rajiv Gandhi Equity Savings Scheme | Eligibility
Securities fraud, also known as stock fraud and investment fraud, is a deceptive practice in the stock or commodities markets that induces investors to make purchase or sale decisions on the basis of false information, frequently resulting in losses, in violation of securities laws. Securities fraud can also include outright theft from investors (embezzlement by stockbrokers), stock manipulation, misstatements on a public company's financial reports, and lying to corporate auditors. The term encompasses a wide range of other actions, including insider trading, front running and other illegal acts on the trading floor of a stock or commodity exchange.
Securities fraud | Introduction
Investor discipline is the ability to maintain an investment strategy even in the most tempting, or extreme conditions in the marketplace. An established and popular method for stock market investors is Systematic Investment Plans (SIPs) especially for those who have a regular, monthly surplus income. The provision for reaping maximum benefits from these plans is that a disciplined strategy is maintained, one of the foremost advantages for a successful investor. Consistency is closely associated with an investment strategy and can be related to various, adopted, proven techniques; for example, predicting outperforming funds, valuation, or a technical strategy. A strategic advantage that meets the required consistency is long-term investment, which in turn, offers investors long-term capital gains tax advantages.
Investor | Discipline
The Seed Enterprise Investment Scheme is a tax advantaged scheme designed to encourage investment from investor in higher-risk small companies that are in their early growth stage to raise equity finance. With contrast the existing Enterprise Investment Scheme (EIS), the SEIS allows qualifying investors can claim income tax relief of 50%, plus capital gains tax relief.
Social venture capital | Seed Enterprise Investment Scheme (SEIS)
FirstPEX is an online auction site (Private Network Market or PNM) for private equity transactions that allows qualified investors to buy and sell equities to each other through a bidding process, which enables the parties to find a mutually agreeable price. Its primary audience is entrepreneurs, investors and business owners, in which negotiations and the exchange of information on investment transactions is covered prior to closing transactions. The site also allows users to trade in non-liquid assets. The platform is not subject to the regulatory supervision by the Swiss Financial Market Supervisory Authority (FINMA); however it is subject to authorization in Europe.
Firstpex | Introduction
Minimal public information combined with thin or volatile trading allow penny stocks to have a greater chance for fraud and manipulation.
Stock promoter | Introduction
An equidimensional scheme (or, pure dimensional scheme) is a scheme all of whose irreducible components are of the same dimension (implicitly assuming the dimensions are all well-defined).
Dimension of a scheme | Equidimensional scheme
In the 18th century, private investors pool their resources to pursue lottery tickets and tontine shares allowing them to spread risk and become some of the earliest speculative institutions known in the West.
Institutional investor | Pre-industrial Europe
Having a competitive advantage, quality company offers good product portfolio, well-established value chain and wide geographical span.
Quality investing | Identification of Corporate quality
Secondary investments refer to investments made in existing private equity assets. These transactions can involve the sale of private equity fund interests or portfolios of direct investments in privately held companies through the purchase of these investments from existing institutional investors. By its nature, the private equity asset class is illiquid, intended to be a long-term investment for buy and hold investors. Secondary investments provide institutional investors with the ability to improve , particularly for investors that are new to the asset class. Secondaries also typically experience a different cash flow profile, diminishing the j-curve effect of investing in new private equity funds.
Private equity | Secondaries
The patterns are there, the numbers are there – all pointing to a wholesale messing with the people's will."
Fraud (book) | Critical response
We then obtain
Revenue equivalence | First price auction