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What is Private Equity?
In the world of finance, private equity is a relatively new industry whereby private companies finance other businesses through direct investment, often in exchange for equity in the company and in some cases, decision-making capabilities.
Private equity companies generally use capital of the principals or of high net worth investors to strategically invest in growing companies that need growth capital or seed capital to expand operations.
The terms attached to the capital infusions vary across private equity companies, but can range from taking equity in the company to warrants to having a seat on the board.
Among other support work, private equity firms can help with financial management, upgrading accounting and IT systems, and establishing new sales practices.
What is a Private Placement?
What Should I Know about Private Placements?
What Happens to My 401(k) if I Leave My Job?
401(k) account balances can be taken to the next place of employment, rolled into IRAs, or cashed out
How is a Roth IRA Different from a Traditional IRA?
The difference is that the Roth contributions are made after-tax while the IRA contributions are deductible from income
How Does a Health Savings Account Work?
A Health Savings Account (HSA) allows the owner to save (and invest) money in an account, which can be used to pay...
What is Form 8282: Donee Information Return?
Non-cash contributions to a charity which are valued at over $5,000 must be reported on a Form 8282 by the organization
What is IRS Publication 513, Tax Information for Visitors to the United States?
Despite how it sounds, this publication is not meant for tourists to the US, but rather for non-US-citizen workers
What is a Bond Purchase Agreement?
The Bond Purchase Agreement is the contract in which the underwriting firm states the price at which they intend to...
B-/B3 — credit rating
The rating in question here, B3/B-, is on the low end of the “Highly Speculative” subset. Risk of defaulting is over 20%
What is market efficiency?
Market efficiency describes the degree to which relevant information is integrated into the price of a security
What is a Private Placement?
Investing in a private placement opportunity is done off-exchange, and usually involves a small number of investors