Qualified investors and future CVM changes

The term ‘qualified investor‘ has gained increasing prominence, mainly due to the diversification of new profiles within the Brazilian capital market. In light of these new times, the Brazilian Securities and Exchange Commission (CVM) recently opened a discussion regarding the classification criteria for this type of investor and released to the public the results of a survey commissioned in order to understand the changes that are needed .

Investors and qualified investor

Qualified investor is a category that includes financial investments in an amount equal to or greater than BRL 1 million and whose condition is recognized in writing or has some certification given by the commission, attested for this purpose.

In this way, the qualified investor belongs to a specialized core of operators, holders of higher access and knowledge, in addition to being aware of the risks involved in their operations.

In a guide on the subject, BTG Pactual defines an investor as that person who invests their resources in the purchase of financial assets traded on the capital market, in search of profitability. Fixed income, in Brazil, is the one that concentrates the most adherents. As highlighted in the text, there is also variable income, which is more volatile and offers the potential investor greater bonuses, but also greater burdens. This last genre, therefore, attracts “a bolder profile, one that knows and accepts the risks aiming at a potentially higher return”.

Investors are divided into categories and this, as explained by CVM, aims to protect market operators from possible attitudes that are not consistent with their intention or structure. In other words, the commission responsible for overseeing and regulating the capital market in Brazil makes these distinctions to bring greater transparency to those who are already in and those who intend to enter this segment.

According to CMV, currently an investor can achieve the status of qualified by holding the minimum amount, that is, R$ 1 million, in financial investments. Once this requirement is met, he must request the Qualified Investor Term from his broker. On the other hand, even if they do not hold the minimum amount in investments, the applicant can thus acquire the status of qualified by submitting and passing a technical test. The rigor of this path is given so that the principle of investor classification, defended by the CVM, is not disregarded. That is, the aim is to prevent applicants with less than necessary knowledge from obtaining the title of qualified investor.

Study and new directions for the category of qualified investors

On the 19th, it was announced that the Brazilian Securities and Exchange Commission started discussions regarding the parameters for the classification of the qualified investor. According to the autarchy, the topic is part of a study by the Office of Economic Analysis and Risk Management (ASA) and is based on international experience.

According to ASA, the ideal would be that the current minimum of R$ 1 million in financial investments be reduced to R$ 627 thousand. The change would make the assets needed for qualification more aligned with the global scenario, that is, 529 minimum wages on average, and would keep the country in line with what is observed in the international market.

CVM highlighted that, in the responses to the survey with investors, it was seen that 65% of those earning more than ten minimum wages were not qualified investors by the equity criterion, but still had a reasonable knowledge of financial investments, which would justify its classification as such. Another point highlighted by the commission was that the monthly income is already used by commercial banks to segment customers and offer differentiated products to those with higher incomes.

InfoMoney recalled that this would not be the first time that CVM has made changes in the parameters of the qualified investor. The current value of BRL 1 million was established in 2015, after a change in the floor that was BRL 300 thousand. On that same occasion, the professional investor was designated as the one with R$ 10 million in investments, far from the R$ 1 million required until then.

Karl Pettersson, coordinator of the ASA study, pointed out that the new proposal follows the diversification of the investor profile. According to the study, a new range of investments in retail is guided by greater risks and interest in alternative financial products, currently restricted to a small portion.

The survey discussed herein heard 5,000 investors in September 2020 and was released on July 19, informing the public that the Brazilian Securities and Exchange Commission will discuss the criteria for the classification of qualified investors.

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