-
formation of collective investment resources on the basis of accumulation of
savings of the individual and corporate investors;
-
transformation of collective investment resources into investments through
their effective distribution;
-
diversification of the deposit investments resources into various investment
projects;
-
reduction of transaction costs;
-
redistribution and reduction of investment risks;
-
smoothing of asymmetric information on savings and investments.
In addition, as noted by A.M. Nikolaeva, the development of the domestic
institutional investors allows to organize savings for long-term investments in
securities of enterprises of the real sector of the economy; to reduce the dependence of
the dynamics of the domestic stock market on the activity of speculative investment
strategies of the foreign portfolio investors; provide retirement benefits and
accumulation of savings to the population, which will positively affect the welfare of
the population as a whole [19]. Consequently, most types of the institutional investors
perform an important social function by involving small investors in the mechanisms
of the collective investment and by contributing, through effective investment, to
raising the level of well-being of the citizens – the participants in investment
institutions [18, p. 34]. The specificity of the financial intermediaries as institutional
investors is manifested through the characteristic features of their functioning as this
type of investor. According to the analysis of the essential features of the activity of
the institutional investors, which are distinguished in the work of the scientists [12; 18;
19; 20], we consider it expedient to attribute to the distinctive features such as:
-
pooling of savings of the individual and corporate investors into the general
fund for the purpose of further investing them on a fiduciary basis;
-
professionalism in the management of collective savings - the generated
investment resources;
-
accumulation of funds of various investors and their management both as
collective investment resources and as the only investment portfolio;
-
investing in a variety of financial instruments;
-
conducting investment on a permanent basis;
-
non-execution of deposit holdings and operations related to their servicing;
-
public nature of activity;
-
continuous monitoring of the activities by the relevant regulatory authorities.
We also note that investing funds by the institutional investors has certain
features, primarily related to the strict regulation of its directions and volumes by the
state. The existence of such regulation is due, firstly, to the need to protect the interests
of the investors, and secondly, the specific nature of the movement of the financial
- 520 -