Thula-I'll answer your question. Most portfolios that contain equity investments usually have mutual funds or stocks. These are the most common equity investments for the average investor.
Now if the investor were looking into hedge funds for example, they might have private equity investments. Hedge funds are exclusive investment vehicles that invest in private equity.
This simply means that they invest in companies that are established and that are financially struggling. Most of these investors need an average of $1 million to enter most of these growth equity investments.
People that invest in private equity investments hope that these companies will turn around and become profitable again. Many hedge funds focus exclusively on this market. A small investor purchasing mutual funds or stocks can do the same by focusing on companies that are financially struggling.
For example, General Motors would be a great illustration of a private equity investment. This is an established company that is reemerging and might be very profitable in the future.
Venture capital investments are the opposite of private equity investments. These investments focus on new up-and-coming companies that might turn a profit in the future. Companies offering an IPO or initial public offering are examples of these types of investments.