Private equity falls in the alternative investments asset class. Whereas investing in equities involves buying a percentage of a company quoted on a public exchange, investing in private equity involves investing directly in private companies or buying them completely. It tends to involve start-up companies or companies with a high potential for growth, or distressed companies that have the potential to turnaround. Investors tend to be institutional; as such, investments require large sums of money that may be locked up for long periods of time, because of the nature of the companies involved, which tend to be rather fragile. Thus private equity investments are considered more risky than traditional investments.