Prospectus
Definition
What is Prospectus?
The formal document explaining a fund's objective, strategy, risks, fees, governance, and dealing rules.
Example in practice
How This Looks in Practice
Before investing, an investorA person or organisation that commits capital with the expectation of a financial return. checks the prospectus for the minimum subscriptionThe process of buying new units in a fund by submitting money and a valid instruction., redemptionThe process of selling fund units back to the fund in exchange for cash. period, and management feeThe recurring fee paid from fund assets to the fund manager for managing the portfolio..
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Related Terms
Mutual Fund
A pooled investment vehicle that combines money from many investors into one professionally managed portfolio.
Fund BasicsUnit
A proportional ownership interest in a mutual fund.
Fund BasicsNet Asset Value
The value of a fund's assets minus its liabilities, usually expressed in total and per unit.
Fund TypesMoney Market Fund
A mutual fund that invests mainly in short-term, relatively liquid instruments such as treasury bills and deposits.