What is rule 12d3 1?

What is rule 12d3 1?

Rule 12d3-1 permits a fund to invest up to five percent of its assets in securities of an issuer deriving more than fifteen percent of its gross revenues from securities-related businesses,48 but a fund could not rely on rule 12d3-1 to acquire securities of its own investment adviser or any affiliated person of its own …

What is a 35d 1 notice?

Pursuant to section 35(d), the SEC adopted Rule 35d-1 under the Investment Company Act (“Rule 35d-1” or the “Names Rule”). The Names Rule states that a materially deceptive and misleading name includes certain specific names.

What is securities related activities?

(1) Securities related activities are a person’s activities as a broker, a dealer, an underwriter, an investment adviser registered under the Investment Advisers Act of 1940, as amended, or as an investment adviser to a registered investment company.

What are registered investment companies?

Registered Investment Company means an investment company that is registered with the Securities and Exchange Commission under the Investment Company Act of 1940 (15 U.S.C. 80a). Examples of registered investment companies are mutual funds and unit investment trusts.

Are portfolio companies affiliates?

As a result, private equity investors that have an active role in managing certain ordinary day-to-day affairs of a portfolio company are likely to be found to be affiliated with these companies.

What is an affiliate SEC?

The term “affiliate” is defined in Rule 405 promulgated under the Securities Act of 1933 as “a person that directly, or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with, the person specified”.

What does investee mean?

investee. noun [ C ] /ˌɪnvesˈtiː/ us. a person or company that has been given money in order to make a profit or get an advantage: Some investors take a close interest in their investee companies, while others provide only financial backing.

What is the name test rule?

The Names Rule requires mutual funds and exchange-traded funds to invest at least 80% of their assets in the investment type, industry and geographic location their names suggest. For example, if a fund’s name includes “U.S. Bond,” the Names Rule requires it to invest at least 80% of its assets in domestic bonds.

What is considered an Oba?

What constitutes an outside business activity (OBA)? OBAs include many non-securities business activities which are conducted outside the scope of the relationship a financial advisor has with their broker-dealer firm.

What is an Oba in finance?

Output-based aid (OBA) is a results-based approach to in- creasing access to basic services—like infrastructure, health- care, and education—for the poor in developing countries. • OBA is also known as “performance-based aid” or “results- based financing” (in the health sector).

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 is the difference between a subsidiary and an affiliate?

Key Takeaways. A subsidiary is a company whose parent company is a majority shareholder that owns more than 50% of all the subsidiary company’s shares. An affiliate is used to describe a company with a parent company that possesses 20 to 50% ownership of the affiliate.

What is considered an affiliate company?

What Are Affiliated Companies? Companies are affiliated when one company is a minority shareholder of another. In most cases, the parent company will own less than a 50% interest in its affiliated company. Two companies may also be affiliated if they are controlled by a separate third party.

Who is considered an affiliated person?

A person who is in a position to influence a firm’s management decisions. Affiliated persons usually include directors, officers, owners of more than 10% of the firm’s outstanding stock, and family members or close associates of these groups. Also called control person.

Who counts as an affiliate?

What Is an Affiliate? Affiliate is used primarily to describe a business relationship wherein one company owns less than a majority stake in the other company’s stock. Affiliations can also describe a type of relationship in which at least two different companies are subsidiaries of the same larger parent company.

What is the difference between investee and investor?

Meaning of investee in English. a person or company that has been given money in order to make a profit or get an advantage: Some investors take a close interest in their investee companies, while others provide only financial backing.

What is Howie test?

In the United States the Howey Test is the standard to determine whether something is a security and whether it falls under the jurisdiction of securities regulators. That is why you keep hearing about cryptocurrency and ICO investments having to pass the Howey Test to be regulated.