What type of clients does the Corporate Act 2001 identify as having a higher investment threshold?

The Corporate Act 2001 distinguishes between different types of clients based on their level of sophistication and the amount they typically invest. Wholesale clients are identified as having a higher investment threshold because they are generally considered to be more knowledgeable and capable of managing larger sums of money. This classification is designed to ensure that more complex financial products and services are made available to clients who have the experience and understanding necessary to handle the associated risks.

Wholesale clients typically meet certain criteria, such as having a minimum net asset value or annual income that surpasses the thresholds established in the legislation. This allows them to access investment opportunities that may not be suitable for retail clients, who are usually afforded greater protections due to their lower investment capacity and lesser experience in financial markets.

The other client categories, such as retail clients and advisory clients, often do not meet these higher thresholds and are thus granted different levels of regulatory protections and access to products. Institutional clients, while potentially having significant investment capabilities, are often categorized separately and may include entities rather than individual investors.