Capital management company, before the KAGB came into force in 2013 Investment company (asset management company, investment trust; mutual fund)
A company that seeks to invest funds entrusted to it in return for share certificates in such a way that – the risks associated with the investment are kept to a minimum by spreading the investments and – the invested assets achieve the maximum possible increase in value. – In addition to the old and new legal designations, the terms investment company and fund company are also frequently used in the financial world. – In Germany, a separate “Law on Capital Management Companies (KAGG)” regulated the business activities of these institutions, which set up investment funds in the form of special assets and issue share certificates in them. At the beginning of 2004, this law and the Foreign Investment Act were incorporated into the new Investment Act (InvG). Under supervisory law, capital management companies are classified as (special) credit institutions and are therefore subject to control by the German Federal Financial Supervisory Authority (BaFin). Most large capital management companies are subsidiaries of banks. The usual legal forms of a fund company are KG or GmbH & Co. KG. – Due to the Investment Amendment Act of December 2007, a capital management company is obliged to adopt rules of procedure (CH: Reglement; rules of procedure), which must be coordinated with the Federal Financial Supervisory Authority (BaFin). – Internationally, the Enlarged Contact Group on the Supervision of Collective Investment Funds exchanges supervisory experience. – See equity fund, investment committee, asset class, unit certificate, investment diversification, order fund, bogey, captive fund, securities fund, financial intermediaries, financial market statistics, corporate fund, fund, ethical, forward pricing, real estate fund, net asset value, Investment Modernization Act, Capital Investment Code, capital cover procedure, cost preloading, country funds, legal opinion, mutual funds, pension funds, risk monitoring, subdivided, special funds, tax-saving funds, reinvestment funds, consumer complaints, asset managers, ordinance on the concretization of the rules of conduct and organization pursuant to the German Capital Investment Code forest funds, branch company. – Cf. Annual Report 2002 of BaFin, p. 15 and p. 41 f. (due to special regulations regarding fund units), p. 88 ff, p. 91 (foreign investment funds in Germany), BaFin Annual Report 2003, pp. 210 ff. (innovations due to the Investment Act), BaFin Annual Report 2004, p. 89, p. 177 (directive on fund categories), pp. 178 f. (supervisory law), BaFin Annual Report 2005, p. 138, p. 143 (prospectus requirement also for asset investments), pp. 145 f. (supervisory law), BaFin Annual Report 2006, p. 75 f. (“specialist concept” [clear language should have been learned in school!] for better risk differentiation), p. 147 (amendment to InvG), BaFin Annual Report 2007, p. 162 (complaints to BaFin about performance of funds; simplified approval procedure for mutual funds), BaFin Annual Report 2008, pp. 191 f. (effects of financial crisis; risk classification by BaFin), BaFin Annual Report 2010, p. 189 (possibility of presenting a fund on no more than two DIN A-4 pages; a more extensive sales prospectus is no longer required), pp. 234 f. (examination of the risk structure of capital management companies) as well as the respective annual report of BaFin, section “Supervision of securities trading and investment business”, ECB Monthly Report of June 2007, p. 28 ff. (overview of funds), BaFin Annual Report 2013, p. 186 (risk classification of KWGs). – In the respective monthly report of the ECB (“Euro area statistics”), various detailed lists (such as: number, assets) of investment management companies can be found under the heading “Monetary developments, banks and investment funds”.
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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
E-mail address: info@ekrah.com
https://de.wikipedia.org/wiki/Gerhard_Ernst_Merk
https://www.jung-stilling-gesellschaft.de/merk/
https://www.gerhardmerk.de/