| In the early 1990s, foreign private equity funds came into China and started to invest in China. Because of the limit of the economic conditions, it developed extremely slowly. With the rapid development of Internet, private equity funds got rich rewards through IPO in overseas. People started to lay their eyes upon their investment effects which promote development of high technology enterprises and others.Since 2002, private equity investment field and scope broadened gradually, funds are invested in various industries such as high-tech enterprises, the traditional manufacturing and real estate industry. These invested enterprises were in each stage of enterprise development. PE (private equity fund) made the enterprise value creation, promoted consolidation in the industry, realized the optimal allocation of resources and promoted Chinese economic development with its capital strength and industry experience.Meanwhile, PE gained rich rewards and developed rapidly. In the first half of 2008, the amount of fund-raising and investment scale of private equity funds achieved lasted highs. During the period of the Financial Crisis, the whole industry shrank a lot, due to its remarkable connection with capital market as well as economic entity. After 2008, PE in China will enjoy a rebound. Especially the amount of RMB private equity funds raised exceeded foreign PE-raising that contacted less with foreign capital market.Private equity investment in foreign practiced successfully and played the unique role in the construction of our country's market economy. It has become inevitable that develops the private equity investment. In October 2009, China GEM (Growth Enterprise Market) started running. Private equity funds obtained the rich rewards through this exit platform. It greatly stimulated the development of PE industry in our country. It became the discussion point of PE industry that how to make the position of PE in financial market and how to develop it.In order to get further development in PE industry , and make it play a bigger role in the changing economic development mode in our country and structure adjustment, much more legal laws and regulations are needed, furthermore, it's of great importance to promote capital market, have better risk management capability of PE and improve its investment decision-making level. PE development environment is constructed all-dimensional and multifold.In the first chapter, based on the current situation of economic and private equity investment, development of private equity investment is described, and the significance of private equity investment to economic domestic can not be doubted. By concluding all kinds of researches nationwide, it is obvious that great progress is made in theoretical research. However, in the aspect of investment strategy and method, we still can not compare with the countries that highly developed in private equity investment. Therefore, more analysis in detail is necessary in research approach.This paper explains PE properties in the second chapter. It explains classification, investment scope and investment process in detail basing on the basal definition. The importance of investment exit is emphasized. Furthermore, according to properties and characteristics of PE funds, the relationship between PE investment strategies and securities investment fund investment strategy is being explored. In conclusion, the key point to make right investment decisions is the ability of private equity investors to operate information, methods to scatter investment and investors' investment skills.The investment effect of PE embodies in its link function between the real economy and capital market. It supports of small and medium-sized enterprises with growing advantages. It is changing the way of economic growth mode and optimizing industrial structure in our country, by mergers. PE also plays an important role in improving capital application efficiency, promoting formation process of China's capital market. This is clarified in the third chapter.In Chapter four, some problems bring by private equity funds due to congenital deficiency and rapid development is analyzed. Therefore, there is no doubt to create suitable legal and financial environment, and of course, to have private equity funds perfect. We hope to make a win-win situation, both the value of enterprise and .income from investment can get increased, which in order to have PE develop successfully.PE has become the central investment entities in China. It has more exit ways and better market environment to invest in high-tech enterprise after GEM working. This pushes forward benign circulation of PE enormously. However, the relevant laws and regulations are still imperfect, and professional private equity investors'shortages still exists. Continuous improvement related legal rules and economic environment for PE development and improving the effectiveness of PE investment strategies has become our fundamental task in the future. PE has become one of the most important investment entities in China. It has more exit ways and better market environment to invest in high-tech enterprise after GEM working. This pushes forward benign circulation of PE enormously. But the relevant laws and regulations are incomplete, professional Private equity investors are still lack. Continuous improvement related legal rules and economic environment for PE development and improving the effectiveness of PE investment strategies is still an important task in the future. |
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