A high-net-worth investor is someone in the last financial year who had an annual income of £100,000 or more (NOT including any one-off pension withdrawals)
Had net assets of £250,000 or more. Net assets do NOT include: your home (primary residence), your pension (or any pension withdrawals) or any rights under qualifying contracts of insurance.
If neither of these apply to you, you do not qualify as a high-net-worth Investor.
If you qualify to be a high-net-worth investor and choose to be categorised as such than you accept that being a high-net-worth investor will expose you to promotions for investment where there is a significant risk of losing all the money you invest and that you are aware that it is open to you to seek professional advice before making any investment in a high-risk investment.
Self-Certified Sophisticated Investor
A self-certified sophisticated investor is someone who in the last two years has:
Worked in private equity or in the provision of finance for small and medium enterprises,
Been a director of a company with an annual turnover of at least £1 million,
Made two of more investments in an unlisted company,
Been a member of a network or syndicate of business angels for more than six months,
If none of these apply to you, you do not qualify to be a Self-Certified Sophisticated Investor.
If you qualify as a self-certified sophisticated investor and choose to be categorised as such then you accept that this will expose you to promotions for investment where there is a significant risk of losing all the money you invest and you are aware that it is open to you to seek professional advice from someone who specialises in advising on high-risk investments such as investing in funds.
Elective Professional Client
In order to be categorised as an elective professional client, Flight Story will be in touch with you to make the necessary assessments as to your knowledge, expertise, experience and understanding in relation to potential investment opportunities provided by them to you. This will include concluding if you satisfy 2 of the following 3 criteria.
You have carried out transactions, in significant size, on the relevant market at an average frequency of ten per quarter over the previous four quarters.
The size of your investment portfolio (cash deposits and financial instruments) exceeds EUR 500,000; or
You work or have worked in the financial sector for at least one year in a professional position, which requires knowledge of the transactions or services proposed to be provided.
To be categorised as an Elective Professional Client, you will also be informed of the loss of protections afforded to Retail Clients under the Rules of the FCA and will additionally lose any right to bring an action for damages against Flight Story under sections 71 and 150 of the Financial Services and Markets Act 2000.
There are investors/entities that will automatically hold (per se) Professional Client status if they fall into one of the following categories:
An entity that is authorised or regulated to operate in the financial markets (regardless of jurisdiction), including:
A credit institution;
An investment firm;
Any other authorised or regulated financial institution;
An insurance company;
A collective investment scheme or the management company of such a scheme;
A pension fund or the management company of a pension fund;
A commodity or commodity derivatives dealer;
A local authority; or
Any other institutional investor.
A large undertaking meeting two of the following size requirements on a company basis:
Balance sheet total of EUR 20 million;
Net turnover of EUR 40 million;
Own funds of EUR 2 million.
A national or regional government, a public body that manages public debt, a central bank, an international or supranational institution (such as the World Bank, the IMF, the ECP, the EIB or another similar international organisation).
An institutional investor that does not fall into Category 1 above, but whose main activity is to invest in financial assets.
A local authority or municipality that does not manage public debt cannot fall into one of the aforementioned categories. They must be treated as a retail client unless they be treated as an Elective Professional Client.