Which one of the following is a 'regulated market' investment by an employer pension scheme, for the purposes of the investment regulations?

• A. An Office Building
• B. A Share in a Private Unlisted Company
• C. A Share Listed on a Recognised Stock Exchange
• D. Units in an Exempt Unit Trust Investing in Property

Answer: (B)

The key idea here is what counts as a “regulated market” investment under the investment regulations for a pension scheme. The regulations treat certain equity securities as being in a regulated market because they are securities that come with formal issuances, governance, and regulatory oversight, even if the trading happens outside a public exchange.

A share in a private unlisted company fits this: it is an equity security issued under regulated rules, and while it isn’t traded on a public stock exchange, it sits in a market that is still governed by securities law and corporate governance standards. This makes it fall under the category of a regulated market investment for the purposes of the rules.

Direct property, like buying an office building, is not a market investment; there isn’t a market mechanism here in the same sense as a traded security. Units in an exempt unit trust investing in property are tied to a property vehicle and may be treated differently under exemptions, so they aren’t counted as regulated market investments in the same way. A share listed on a recognised stock exchange would typically be a regulated market investment as well, but in this specific context the private unlisted equity is the one classified as meeting the regulated market criterion.