Please read the following risk warnings carefully before entering into any funding opportunity via the Regionally private members exchange.
As an experienced or sophisticated investor, it is important that you have understood and accept the risks of investing in private equity or bonds or as an advised investor it is important that your advisor has explained the risks in investing in private equity or bonds.
Need for diversification
You will understand the need to spread your investments across different companies and asset classes with a spread of risk levels depending on your investment strategy and attitude to risk. However, the risk of losses in equities and bonds is possible and you should have a balanced and diverse portfolio of investment classes.
Any investment made on the Regionally private member exchange should be balanced with other types of investments.
Equities and bonds
The return on investments in equities made through Regionally may not be regular or dependable depending on the offer type and use. Some companies who are listed will offer regular dividends, but these will be dependent on company performance, other companies may not offer dividends but seek to reward investors with capital growth at exit. Neither of these will be guaranteed.
The return on bonds will be regular paying a fixed rate and on a published schedule.
The specific risks of each investment, either equity or bonds, are set out in the investment document published by each company.
Loss of investment or tax relief
Regionally promotes only established companies but it is still possible that you may lose some or all of your investment. Regionally recommends that investors only invest an amount that you are willing to lose and should build a diversified portfolio to spread risk and increase the chance of an overall return on your investment capital. If a business you invest in fails, neither the company will pay you back your investment unless the investment is in the form of a secured bond and then only part of the investment may be paid back.
Tax relief may also be lost due to your personal circumstances or due to the activities of a company.
Lack of liquidity
Liquidity is the ease with which you can sell your shares after you have purchased them. Buying shares or bonds in businesses listing on Regionally may not be fully liquid even though they are listed on our exchange. Even successful companies rarely list shares on such an exchange. In addition, if you purchase none voting Investment Shares, these are these may not be attractive to potential buyers.
Rarity of dividends
Dividends are payments made by a business to its shareholders from the company’s profits. Each company listed on Regionally will provide a statement at listing on their dividend plans but businesses have no obligation to pay shareholder dividends.
All investments made through Regionally may be subject to dilution in the future. Dilution occurs when a company issues more shares. Dilution affects every existing shareholder who does not buy any of the new shares being issued. As a result, an existing shareholder’s proportionate shareholding of the company is reduced, or ‘diluted’- this has an effect on a number of things, including voting, dividends and value.
Please check a pitch, and the Articles of the company to see if the shares you are buying will have these pre-emption rights.