I am very confused about the definition of qualified purchaser

A **qualified purchaser** is a specific type of investor in the private markets, distinguished by its substantial investment capabilities and sophistication. The term is primarily used in the context of securities law and regulation, particularly in the United States. Here's a detailed breakdown of what constitutes a qualified purchaser:

1. **High Net Worth or Investment Portfolio**:
- Qualified purchasers must have a minimum of $5 million in investments, excluding their primary residence or business property.
- This threshold is significantly higher than the net worth requirement for accredited investors, which is typically $1 million.
2. **Investment Sophistication**:
- Qualified purchasers are expected to have the knowledge and experience to handle the risks associated with private investments.
- They are often institutional investors or wealthy individuals with substantial experience in investing in securities.
3. **Access to Restricted Investment Opportunities**:
- Qualified purchasers have access to a broader range of investment opportunities than accredited investors, including those that are exempt from SEC registration under certain provisions of the Investment Company Act.
- This includes the ability to invest in funds that are exempt from registration under Sections 3(c)(1) and 3(c)(7) of the Investment Company Act, which is not available to accredited investors.
4. **Regulatory Treatment**:
- The SEC has established rules governing the sale of securities to qualified purchasers, which are designed to facilitate efficient capital formation while still providing appropriate protections for investors.

In summary, a qualified purchaser is a sophisticated investor with substantial financial resources who is able to invest in private securities that are not publicly registered. This designation is distinct from that of an accredited investor, who must meet different criteria based on income, net worth, or securities licensing.