Most people don’t realize it but the investment world is notoriously closed off to outsiders. If you aren’t making a sizable income right now, enough to meet the rigorous SEC ‘accredited’ standards, then you never will be given those juicy financial options. The recently released film ‘Money Monster’ touched on a host of issues with Wall Street and the financial world in a heightened, slightly sensational way. Forefront Capital CEO Brad Reifler saw many issues in real life reflected in the film ‘Money Monster’ and decided to drop some of his opinions on the subject.
The primary thing that separates people in the investment world, according to Reifler, is their ‘accredited’ status. An accredited investor is given a bevy of options than the ‘regular’ investor will never see. The assumption here by the SEC is that the ‘99%’ of investors outside of their standards are simply too dumb to capitalize on these opportunities. Reifler feels like this fundamentally undermines the fairness of participating, thus pushing many already at-risk investors into even rougher territory. Is this far? No. Is this how the world is? Yes.
Next up Reifler is quick to point out how Wall Street brokers typically don’t always go to bat for their investors in an equal fashion. Most brokerages get their cut of money no matter how well the investments are doing, which means many lower tier investors are simply left in the dust when their account goes belly up. That is why most investors capitalize the majority of their time on the ‘accredited’ investor, creating another imbalanced relationship.
Finally, Reifler points out that the majority of investors are beholden to the stock market in a way that isn’t healthy for their finances. The stock market at its core is the riskiest way to invest your money. When an accredited investor struggles with the stock market they merely shift their finances around. When a non-accredited investor experiences that same struggle they are typically going to end up losing everything. With that being said, Reifler is working on creating fair investment opportunities for everyone through his company Forefront Capital.