What is a sophisticated investor?

A sophisticated investor is anyone who:

  • Has assets of at least $2.5 million; or
  • Has had an income of at least $250,000 per annum over the past two years; or
  • Controls a company or trust which meets the requirements of either item 1 or 2 (above).

You’re expected to have in-depth knowledge of a range of investments, and have built the wealth to prove it. To show you’re a sophisticated investor, you also need to be certified by a qualified accountant.

What are the benefits of being a sophisticated investor?

Being a sophisticated investor opens doors to a greater number of premium investment opportunities.

You’ll generally have access to exclusive investments that regular retail investors don’t. Many property investment groups only allow sophisticated investors to partake in their investment opportunities because these investments are far more complex. They may include:

Such investments would likely offer a more competitive return than typical public opportunities, and provide a high chance of capital growth. This means you can diversify your portfolio far better than if they were a standard retail investor.

What is a sophisticated investor certificate?

If you fulfill the criteria, you must still apply for a  certificate (under the Corporations Act 2001) through a qualified accountant. This is a requirement by the Australian Securities and Investments Commission.

The certificate is valid for two years and an investment must be made by you within the first six months.

How to apply for a certificate?

If you’re looking to become certified as a sophisticated investor, contact your accountant or financial adviser. As long as they are qualified to do so under the Corporations Act 2001, they can apply for you. The decision to do so is left up to the accountant.

If you want to take action yourself, you can register with Cygura.

Where should I invest?

For information on how to invest in high-quality sophisticated investments, get in touch with us. We invest alongside our investors in high-quality commercial property investment opportunities, with the majority of our clients being sophisticated investors. At Properties & Pathways, we’re in it together.