Standardized Development Of China's Private Equity Fund

Private Fund is a kind of aggregate investing institution that fund managers finance from certain investors without public advertisement and operation. In essence, a private fund, which is usually a 'closed-end' fund (ie it runs for a pre-determined number of years and is then terminated), is set up among a group of up to 50 people, each contributin significant amount of money (it wouldn't normally be less than $1m each) and investing into a particular class of assets. The advantages are that professional managers can use their specialised knowledge of the selected asset class to obtain higher returns than that can be expected from public funds, which are often listed, usually open-ended, and almost always constrained by regulation, even in offshore jurisdictions, which normally apply some prudential rules to listed funds, even if these are weaker than those applied in high-tax countriesCompared with Mutual Fund, Private Fund does not mean illegal or under-the-table fund without supervision. As the inevitable outcome of the development of social production, private fund spreads out in China persistently. Since the legislation of private fund has not been completely established in China, there are unavoidable inner problems in Chinese private funds. Moreover, she is facing intensive challenges from foreign competitors.If better market environment were not created for the existing large flow of capital of our Private Funds, it woule be very difficult for them to obtain a healthy and sustainable development, moreover, the huge potential financial risk is lurking.In sum, the purpose of this thesis is leading the Chinese private fund to produce a positive effect on the development of chinese finical market and economy by keeping a correct attitude to it's existence, analyzing the necessity of regulations on private fund, and applying the relevant experiences obtained in developed countries to the current status of private fund in china.This thesis composes five sections. The first chapter is a brief introduction to private fund. The second chapter is a detailed introduction to the present situation and problems of Chinese private fund. The third chapter is a summary of private fund development in western countries.The fourth chapter expounds the possible tendency and the significance of the private fund, the final chapter raises preconditions for private fund going public, regulations for transactions, and suggestions on supervision. The fresh idea of this thesis is the analysis of Chinese Private Investment Funds which includes Private Equity Funds and Private Venture Capital.