What companies are required to file with the SEC?

Public companies, certain insiders, and broker-dealers are required to make regular SEC filings. Investors and financial professionals rely on these filings for information about companies they are evaluating for investment purposes. Many, but not all SEC filings are available online through the SEC’s EDGAR database.

What is a business development company SEC?

What are BDCs? BDCs are a type of closed-end investment fund. They are a way for retail investors to invest money in small and medium-sized private companies and, to a lesser extent, other investments, including public companies. BDCs are complex and have certain unique risks.

How do I set up a business development company?

To become a BDC, a company must file Form N-6 with the SEC (intent to file a notification of election). Then, a company must file a notice on Form N-54A indicating that it elects to be regulated as a BDC under the 1940 Act.

Who is required to register as an investment company?

Register With the IARD Every investment firm is required to register on the federal level with the SEC and must also file on the state level with a self-regulatory organization (SRO), a private entity that operates in a government-regulated industry and oversees its users or members.

Are business development companies a good investment?

BDCs offer investors high dividend yields and some capital appreciation potential. BDCs heavy use of leverage and targeting of small or distressed companies makes them relatively high-risk investments.

How does a BDC make money?

Most BDCs make money investing in companies via debt financing (buying bonds and providing loans) to a company. If they hold stock in the companies they invest in, the BDCs profit if the stock price (or net asset value) increases. BDCs also make money by investing in senior secured bonds and loans.

What are the three types of investment companies?

The federal securities laws categorize investment companies into three basic types:

  • Mutual funds (legally known as open-end companies);
  • Closed-end funds (legally known as closed-end companies);
  • UITs (legally known as unit investment trusts).

What licenses do I need to be a registered investment advisor?

To be a registered advisor, one needs to have the following qualifications: Professional qualification or postgraduate degree or postgraduate diploma in finance, business management, banking, capital market, accountancy, commerce, economics, or insurance with five years of experience. Have a NISM level 2 certification.

How to become a business development company ( BDC )?

These companies have either notified the Commission of their intent to be regulated as a BDC by filing a Form N-6F or elected to be regulated as a business development company by filing a Form N-54A.

What are the requirements to be a BDC?

As a general matter, a BDC must also maintain at least 70% of its investments in eligible assets before investing in non-eligible assets. To be treated as a BDC, a company must elect, pursuant to Section 54(a) of the 1940 Act, to be subject to the provisions of Sections 55 through 65 of the 1940 Act.

What is the investment company registration and regulation package?

This Investment Company Registration and Regulation Package (“Package”) contains general information about investment companies ( e.g ., mutual funds, closed-end funds, and unit investment trusts) and supersedes the “Investment Company Registration Package” that was previously distributed in a printed format.

How are management companies classified in the SEC?

Management companies are divided into open-end companies and closed-end companies. See Section 5 (a) of the Investment Company Act. Management companies are further classified as “diversified” or “non-diversified” funds based on the composition of their assets.