Please stay tuned for important disclosure information at the conclusion of this episode.

Welcome to Investing Insights. I'm your host, Ivana Hampton. Ticktox financial community draws millions of people looking for advice. Some mutual fund companies see the social media app itself

as an investment opportunity. Their betting TikTok parent company BiteDance could rival other

platforms. In this episode, I'll talk with tax expert at Slot about the IRS, warning about

trust being promoted on TikTok.

Those who follow the advice could get audited.

But first, let's start with whether some mutual fund company's valuations of privately held bite dance match its publicly traded competitors.

Here's my conversation with Morningstar Research Services, Senior Manager Research Analyst, Jack Shannon.

Thanks for joining me, Jack.

Yeah, happy to be back.

So let's start off with how are privately held companies like Bite Dan's valued, and how does it work?

Yeah, so there's actually no rules and no regulations on how a fund company can value a private equity holding.

So it's not up to the portfolio managers, so you're not going to see the person actually running the fund determining the valuation because that presents some obvious issues and conflicts of interest.

Most of these firms have independent teams that assess the

valuation of the company and then sort of push that out to any funds within their lineup

that hold that private holding. So in practice, they look for observable prices. So for private

equity, the only real observable prices are financing grounds.

So these companies are usually young companies.

They're unprofitable.

They're always needing more money because, hey, we have a new product we need to launch.

Or, hey, we need to make this big marketing push because for all them to get higher valuations,

it's all about growth, growth,

...