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Risk Warning

Risk summary for non-mainstream and pooled investments

Estimated Reading Time: 2 min

Due to the potential for losses, the Financial Conduct Authority (FCA) considers certain investments to be considerably complex and high-risk.

1You could lose all the money you invest

  • If the business offering these investments fails, there is a high risk that you will lose all your money. Unlisted early-stage companies, unlisted equity, unlisted debt, and investments in Unregulated Collective Investment Schemes (UCIS) can often fail as they can often use risky investment strategies.
  • Advertised rates of return are not guaranteed. This is not a savings account. If the issuer does not pay you back as agreed, you could earn less money than expected or nothing at all. A higher advertised rate of return means a higher risk of losing your money. If it looks too good to be true, it may well be.
  • These investments are very occasionally held in an Innovative Finance ISA (IFISA). While any potential gains from your investment will be tax-free, you can still lose all your money. An IFISA does not reduce the risk of the investment or protect you from losses.

2You are unlikely to be protected if something goes wrong

  • Protection from the Financial Ombudsman Service (FOS) does not cover poor investment performance. If you have a complaint against an FCA-regulated firm, FOS may be able to consider it. Learn more about FOS protection here: https://www.financial-ombudsman.org.uk/consumers

3You are unlikely to get your money back quickly in certain investments

  • Certain types of businesses could face cash-flow problems that delay payments to investors. It could also fail altogether and be unable to repay any of the money owed to you.
  • You are unlikely to be able to cash in your investment early by selling your investments. In the rare circumstances where it is possible to sell your investment in a 'secondary market,' you may not find a buyer at the price you are willing to sell.
  • You may need to give an extensive notice period and have to pay exit fees or additional charges to take any money out of your investment early.

4This can be a complex investment

  • Certain kinds of investment have a complex structure based on other risky investments, which makes it difficult for the investor to know where their money is going.
  • This makes it difficult to predict how risky certain investments are, but it will most likely be high.
  • You may wish to get financial advice before deciding to invest.

5Do not put all your eggs in one basket

  • Putting all your money into a single business or type of investment for example, is risky. Spreading your money across different investments makes you less dependent on any one to do well.

For further information about unregulated collective investment schemes (UCIS), visit the FCA's website here.

Still interested in investing?

Make sure you understand the risks and consider seeking professional financial advice before making any investment decisions.

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Shadow Capital Partners

Shadow Capital Partners is the trading name of the registered company Shadow Foundr Ltd (09496687) and it is regulated by the FCA (695116).

Investing in start-ups, unlisted equity shares, unlisted debt securities, and unregulated collective investment schemes (UCIS) involves risks, including loss of capital, illiquidity, lack of interest, dividends, and dilution, and it should be done only as part of a diversified portfolio. Tax Treatment of investments depends on individual circumstances and is subject to change. Investments should only be made by investors that fully understand the risks. Prior to considering investing, please read the full Risk Warnings: click here

This webpage has been approved as a financial promotion by Shadow Foundr, which is authorised and regulated by the Financial Conduct Authority (FCA). It is not intended to be a promotion of any individual investment opportunity, and the summary information provided about investment opportunities is intended solely to demonstrate the types of investments available through the Shadow Foundr platform. Full listings are available to authorised investors on the Shadow Foundr platform only. All investment activities take place within the United Kingdom, and any person resident outside the United Kingdom should ensure that they are not subject to any local regulations and/or restrictions.

Shadow Foundr does not make investment recommendations and no communications from Shadow Foundr, either through this website or by any other means, should be construed as an investment recommendation. Nothing on this website should be used as an offer or solicitation of an offer to buy, sell, or subscribe for any investment, nor to constitute advice or recommendation with respect to investments to any person in any jurisdiction where such an offer or solicitation of an offer to buy, sell or subscribe is not permitted. Shadow Foundr does not provide legal, financial, tax or indeed any advice of any kind. If there are any questions with respect to legal, financial or tax matters relating to anything on the Shadow Foundr website, then persons should consult their professional financial adviser.

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