A legal document that makes an official offer to sell a security, mutual fund, or unit investment trust (UIT) product. The Securities and Exchange Commission (SEC) establishes the rules regarding what information each type of prospectus must contain, but in general it must include sufficient information for an investor to make an informed evaluation about the risks associated with an investment. A prospectus typically describes the enterprise and its management, provides details about the product offering such as voting rights and anti-dilution provisions, and it discloses the financial state of the company and risks associated with the enterprise. The mutual fund's prospectus will also disclose information such as its fee structure, investment objectives and strategies, and performance history. See Final Prospectus; red herring prospectus.
Browse by Subjects
Class B shares
See All Related Terms »
historical exchange rate
American Psychological Association (APA):
Chicago Manual of Style (CMS):
Modern Language Association (MLA):