‘Money Monster’ released into theaters at a timely moment: during an economic crisis that still effects many people. ‘Money Monster’ follows a Wall Street advising talk show host, played by George Clooney, as he is taken hostage by a disparate and disgruntled investor who lost it all following Gates advice. What follows is a long look into how the investment world has left the ‘little guy’ behind. Forefront Capital CEO Brad Reifler took time to address some of the recurring problems in investing thanks to how they were highlighted by the film.
There are three core components that make up the disparity between small time investors and the so called ‘accredited investors’. First off, the SEC has defined an accredited investor as someone who has a net worth of at least $1 million, excluding any real estate investments. The majority of people you know likely don’t fit into this slice of the pie. As a result accredited investors are given priority in many ways in the investment world, something Reifler wanted to point out.
To start off his list of issues with Wall Street Reifler pointed out just how badly fees have gotten in the financial world. Wall Street brokers will charge their fee against non accredited investors no matter how much money the brokerage firm has lost or gained. This means that no matter what the brokers get richer.
Next up, Reifler points out how many doors are closed to the non accredited investor. Accredited investors are able to take on less risky, higher earning investments thanks to a government that caters to them. As a result the lower class of investor is put on a tougher road to the top despite the fact that the road was already tougher. This points out Reifler’s third complaint: the inherent risk of the stock market. Non accredited investors are forced to rely on the risky stock market to make waves. A risk that most can’t weather.
Reifler has been using his company, Forefront Capital, to try and change the way investments are made at the lower end. He’s making several innovative choices to help out the ‘99%’ of investors out there that don’t get the SEC accredited label. Read about what Brad has accomplished with his company on About.me.