The multitude of actors who operate in financial markets interact with each other to exchange financial assets and allow money from individuals and institutions to be channeled into investments. That’s why in financial markets you can find asset issuers (companies or governments), intermediaries (financial institutions), supervisors and regulators, and investors. Different types of investors can be classified based on criteria such as category, objective, investment horizon, risk aversion or their way of acting when operating in the market.
According to the investment category
One can distinguish between an individual or retail investor and an institutional one.
- Individual investor. A person (physical or legal) who makes investments on their own account, thus creating their own portfolio with the aim of obtaining a return on their savings.
- Institutional investor. Large and specialized investors who usually pool the…