Finance glossary
Prospectus
Definition
A legal document disclosing details about an investment offering.
A prospectus is a formal filing that discloses an investment material facts, including strategy, risks, fees, and financials, so investors can make informed decisions. Mutual funds and companies issuing new securities are required to provide one by regulators.
In a sentence
Before investing, he read the fund's prospectus to understand its strategy, fees, and risks.
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