Sophisticated Investments

What are Sophisticated Investments?

A sophisticated investor is when you have sufficient experience and knowledge with investing into high risk vehicles and can see an investment opportunity. Your net worth and income is also taken into consideration for you to be classified as a sophisticated investor. Typically, to be a sophisticated investor you must have either a net worth of $2.5 million or have earned more than $250,000 in the past two years to qualify. You may have to prove their net worth prior to being eligible to purchase certain security types and often will need to have their personal bank accountants used as proof to their brokerage firm.

Why have Sophisticated Investments?

Being a Sophisticated Investor means that you are able to take immediate action if an investment does present itself. A sophisticated investor isn’t required to have all of the legal paper work that a first time investor will require. Sophisticated investors (as defined by the Corporations Act 2001) are able to access investment opportunities which are not open to retail investors. Wholesale investment opportunities that are typically reserved for institutional and professional investors include:

  • Domestic and international equity offerings
  • Fixed income and asset backed bonds
  • Packaged equity solutions
  • Strategies to reduce the effect of market volatility




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