Frequently Asked Questions

Why is the Exempt Market Important?

The exempt market is an essential component of our capital markets for entrepreneurs, small business, start ups, and investors. As it relates to business, our industry fills the financing needs of those who do not meet the criteria of the traditional brokerage world. As it relates to investors, our industry fills the need of lower cost, easy to understand, non-volatile investments.


What is an Exempt Market Security?

An exempt market security is a security which is distributed under an exemption from the prospectus requirement. Being prospectus exempt means that there is less information disclosed to investors but there are typically less investor borne costs than associated with a public offering. Exempt market securities are generally illiquid, meaning that once the funds are put into the investment, there isn't a way for the investor to get their invested capital out if circumstances require. Having said that, exempt market securities are not subject to the fluctuations of the stock market. Basically, it's a function where an entrepreneur can efficiently, and cost effectively raise capital, meanwhile, investors can compromise some risk in lieu of lower costs, giving the freedom to invest in a variety of exempt securities.

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