Private equity funds refer to investment funds raised and operated in a non-public way. 19 At the end of the 20th century, some wealthy bankers in the United States put their money into industries with high risks at that time, such as oil and railway, through the introduction of accountants and lawyers. This is the embryonic form of private equity funds.

In 1980s, private equity funds came to China, but they did not change their status as "optimates". In China, the threshold for investing in private equity funds is higher. The CSRC strictly requires that all the conditions of "qualified investors" must be met: if it is a unit, its net assets are not less than 6,543,800,000 yuan; For individuals, the financial assets are not less than 3 million yuan, or the average annual income in the last three years is not less than 500,000 yuan, and the investment amount of a single private equity fund is not less than 1 10,000 yuan.

According to relevant laws and regulations, managers of private equity funds can only raise funds from qualified investors and cannot publicize them to the public through newspapers, television and the Internet. Private equity funds shall attract no more than 200 investors, and both parties must sign a standardized fund contract and file it with the fund industry association after the fundraising is completed.

2. Operation mode of private equity fund

Therefore, private equity funds are very different from public-oriented Public Offering of Fund. Compared with Public Offering of Fund, private equity funds do not need to disclose investment information to the public, and their investment methods are not restricted by policies. They can flexibly put their assets in stocks, bonds, foreign exchange, precious metals, real estate, corporate equity and other varieties to pursue absolute high returns. At the same time, fund managers also extract profits from it and participate in benefit sharing.

It can be seen that the operation mode of private equity funds determines that they can create relatively high returns, but they also have to bear relatively high risks. In real life, the news of the failure of private equity investment is common, and the relevant laws, regulations and supervision in China still need to be strengthened. Qualified investors should also fully assess risks and invest cautiously.