Accredited Investor
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Definition of 'Accredited Investor'A term used by the Securities and Exchange Commission (SEC) under Regulation D to refer to investors who are financially sophisticated and have a reduced need for the protection provided by certain government filings. Accredited investors include individuals, banks, insurance companies, employee benefit plans, and trusts. |
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Investopedia explains 'Accredited Investor'In order for an individual to qualify as an accredited investor, he or she must accomplish at least one of the following:1) earn an individual income of more than $200,000 per year, or a joint income of $300,000, in each of the last two years and expect to reasonably maintain the same level of income. 2) have a net worth exceeding $1 million, either individually or jointly with his or her spouse. 3) be a general partner, executive officer, director or a related combination thereof for the issuer of a security being offered. These investors are considered to be fully functional without all the restrictions of the SEC. An employee benefit plan or a trust can be qualified as accredit investors is total assets are in excess of $5 million. |
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