Question

In a private placement, the issuing firm negotiates the terms of the offer directly with a small number of _____, individuals or businesses that meet specific financial requirements set by the SEC. a. venture capitalists b. stockbrokers c. angel investors d. accredited investors

Answer 1

Accredited Investors

Step-by-step explanation:

To ensure that investors are making an educated investment, the SEC selects people who are experienced (and presumably successful) in the field of investing. They are allowed to engage in unregistered (not public) securities.

Stockbrokers handle stock. They do not engage in private securities, instead trading public securities, such as stock.

Angel investors and venture capitalists usually do not engage with private securities, and are part of a relatively (very) large group of investment entities. Many of these entities may not meet qualifications to trade in private placements.

HOWEVER, any of the other 3 choices can also become accredited investors/investing institutions.

(not my specialty, just happen to have just read about it)