Financial instruments

The selection of financial instruments is initially differentiated into alternative instruments, securities, and alternative investment funds. In GO numerous instruments can be portayed: https://portagon.zendesk.com/hc/en-us/articles/10478386659101-Which-financial-instruments-are-supported-by-portagon-go 

Alternative Instruments

Alternative Instruments, as defined in § 1 Abs. 2 VermAnlG, include non-securities in the sense of the Securities Prospectus Act and are not designed as shares in investment assets as defined in § 1 Abs. 1 of the Capital Investment Code. They consist of:

  • Shares granting participation in a company's results.
  • Shares in a trust managed by the issuer or a third party.
  • Profit participation loans.
  • Subordinated loans.
  • Profit-sharing rights.
  • Registered bonds.
  • Other investments that promise interest and repayment or a monetary settlement in exchange for the temporary provision of money, and
  • Investments promising interest and repayment, or a monetary or material settlement through the provision of standard precious metals, provided the acceptance of funds is not classified as a deposit business under § 1 Abs. 1 Sentence 2 Nr. 1 of the Banking Act.

Provided that the acceptance of funds is not to be classified as a deposit business within the meaning of § 1 paragraph 1 sentence 2 no. 1 of the German Banking Act (Kreditwesengesetz).

https://www.bafin.de/DE/Aufsicht/Prospekte/Vermoegensanlagen/Verfahren/verfahren_node.html 

 

Securities

An overview explaining different types of securities:

  • Bonds: Corporate or government bonds involve lending money to the issuer, with the expectation of repayment plus interest after maturity.
  • Stocks: Issued by companies to raise capital for investments, shareholders benefit from profits but also share the risks.
  • Certificates: A special form of exchange-traded securities whose value is based on the forecasted prices of certain stocks, currencies, or commodities. They are not suitable for beginners due to high speculative risks.
  • Debentures: Another term for bonds where the lender provides a loan to be repaid with interest.
  • Funds: These combine various types of securities into a portfolio to diversify risk and enhance the chance of profits over a longer period. Funds can include different investment forms like stocks, shares, or bonds.
  • ETFs (Exchange Traded Funds): These bundle multiple stocks in a portfolio and track a stock index like the DAX. Unlike actively managed funds, ETFs incur no management costs as they are not actively managed.

In the go software by portagon, the following financial instruments are available for selection: Bearer bonds, Registered shares, Participation certificates, Order bonds.

 

Alternative Investment Funds

Unlike regular investment funds, an Alternative Investment Fund (AIF) represents a monetary asset not intended for investments in stocks and securities but for tangible asset investments.

Alternative investments include forms of investment that do not belong to conventional types (e.g., stocks, bonds, cash). They are typically held by institutional investors or high-net-worth accredited individuals due to their complex nature and investor eligibility requirements. Common alternative investments include Private Equity, Private Credit, Real Estate, Hedge Funds, and structured investments. Alternatives usually exhibit different characteristics than traditional stock and bond investments in terms of risk-return and investment horizon. They can be used in a portfolio to enhance return/income potential, provide diversification, and/or reduce volatility.

In the go software, the following financial instruments are available: Subordinated loans, Profit participation loans, Participating rights, Silent partnerships, Alternative Investment Funds (AIF), other financial instruments, Limited Partnership.

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