For novice investors:
When you hear the word investing, images of day traders and wealthy stockbrokers vigorously trading at high stakes probably comes to mind.
But you need to be neither a millionaire nor an expert in the stock market in order to begin investing. There are multiple investing avenues for a retail investor: mutual funds, real estate, and direct investing, to name a few.
When people speak of individual or retail investors, they are often referring to non-accredited investors. Non-accredited investors are individuals who earn under $200,000 in one year and have a million or less in assets excluding their primary residence. Non-accredited investors actually make up the bulk of retail investors in the United States: 91.75% of investors in America are non-accredited. This term essentially covers the vast majority of American individuals.
The SEC regulates what a non-accredited investor is able to invest in; their investment choices are limited for their own financial safety, preventing potential financial losses. Although options are limited, this does not mean that non-accredited investors don’t have the opportunity to invest in a variety of securities. Where private and hedge funds deal primarily with accredited investors, since there is more risk and volatility, mutual funds deal more with non-accredited investors, as the SEC deems them eligible to invest in them. Due to recent changes by the SEC, there are a variety of options available to non-accredited individuals including direct investing, real estate, equities, municipal bonds, and Peer-to-Peer loans, allowing them to invest in a diverse array of securities.
Direct investment has opened up a plethora of opportunities for non-accredited investors and has supported all sides of the community including helping start-ups across the country fund their companies. Getting started with direct investing is a lot easier than you might think. Pyrium is an educational platform and marketplace for non-accredited investors interested in direct investing into private companies. If you’re interested in learning more about direct investing, check out our Investor Literacy Course for Beginners and/or join our Discord Community – a place where you can talk about investment opportunities in a casual and culture-forward manner with other retail investors.