What is a wholesale investor?
In Australia, a wholesale investor (also referred to as a wholesale client) is an investor who meets certain financial thresholds or professional criteria set out in the Corporations Act 2001 (Cth). Wholesale investors are generally considered to have a higher level of financial sophistication and are therefore permitted to access investment products that are not available to retail investors.
The distinction matters because products offered exclusively to wholesale investors, such as certain mortgage funds and private credit opportunities, are not required to provide a Product Disclosure Statement (PDS) in the same way as retail products. Instead, they are typically offered under an Information Memorandum (IM).
How do you qualify as a wholesale investor?
There are several pathways to qualifying as a wholesale investor under the Corporations Act. The most common include the product value test, where the investment amount is at least $500,000; the net asset test, where the investor has net assets of at least $2.5 million, certified by a qualified accountant; and the gross income test, where the investor has earned gross income of at least $250,000 per annum over each of the last two financial years, also certified by a qualified accountant.
Professional investors, including holders of an Australian Financial Services Licence, regulated superannuation funds, and certain government entities, also qualify as wholesale investors by virtue of their professional status.
What does wholesale investor status mean for investing?
As a wholesale investor, you gain access to a broader range of investment products, including private mortgage funds, direct lending opportunities, and other alternative credit investments that are not available to retail investors. These products may offer higher target returns, but they also carry different risk profiles and may have less regulatory protection than retail investment products.
What should wholesale investors consider?
Wholesale investors have a responsibility to conduct their own due diligence before investing. This includes reviewing the fund’s Information Memorandum, understanding the fee structure, assessing the risks, and obtaining independent financial, legal, and taxation advice. Granor Capital’s investment funds are available exclusively to wholesale and sophisticated investors.
Related resources from Granor Capital
Once you understand your eligibility, explore what to consider before investing in a mortgage fund and learn about private credit as an asset class. View Granor Capital’s wholesale investment funds.
This article is provided for general information purposes only and does not constitute financial advice. Investors should seek independent professional advice before making any investment decisions.
