Equities are return enhancing instruments. In general, the younger you are, the more equities you should hold in your portfolio.
There are different types of "equities" and your objectives and constrains will determine which one is more suitable for your portfolio.
The more risk you want to take, the higher the risk-return mix you should target, e.g. Venture Capital and Private Equity.
The type of equities falling into the greyed area in the chart are publicly available whilst those falling outside are available on private markets only. Private Equity and Venture Capital are indeed not publicly accessible, which means there is no public exchange where you can gain exposure to these asset classes. Conversely, Blue Chips up to Nano Cap are publicly listed, which make it easier for you to buy/sell.
When you buy equities you generally become an owner of the company and have right to receive a dividend if the company decides to pay it. The dividend size and frequency is uncertain as it really depends on how good the company performs as well as its growth prospects. The higher the growth prospects, the lower the chance of paying a dividend, as the cash that the company generates gets re-invested into the business.
If you are a maverick and very patient investor then Venture Capital is for you. It usually takes 10 to15 years to see results here, if any. In Venture Capital if you buy a portfolio of 20 "seed-stage" companies you would generally expect to make big gains in 1 out of 20 companies, ok gains in 1 out of 20 companies, and lose all your money on the rest. Hopefully with the deal that succeeds you will be able to make up for the losses on the entire portfolio and end up net positive (generally 15/20% per annum until full realization). An example where you can invest in Venture Capital is Seedrs, which is a platform where you can buy stakes into "ideas" or real businesses (at seed-stage), or Microventures to cite a few.
If Venture Capital is not for you, you can add Private Equity to your portfolio, although this is more for accredited investors which are people with more than $500k or $1M net worth. You would want to add Private Equity to your portfolio if you want to gain exposure to levered equity with great upside potential. Also Private Equity would make it a source of broadly uncorrelated returns than traditional equities and capture what is commonly called "liquidity premium".
On the public side of equity is Nano, Micro, Small, Mid, Large, and Mega Caps, with Blue Chips closing the circle. The more wealth you have, the easier for you to spread it in any of the above buckets. There are lots of platforms where you can gain exposure in public equities either in the form of Funds like ETFs or if you are a good stock picker you can buy single stocks yourself.
The key differentiator factor among theme is size (market cap). The bigger the company, the lower the risk due the more stable cash flows it generates and the more global presence.
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