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You may have lost money in your investment portfolio,
due to mismanagement and not even know it.

Focus on "accredited" investors: What does the term mean?

In the collective eyes of federal and state financial regulators, not all investors are the same.

That is, there is a continuum of investment acumen and sophistication applicable to the class.

At one extreme reside individuals and entities that are deemed by the U.S. Securities and Exchange Commission and state bodies with regulatory oversight to be sufficiently knowledgeable and experienced to deal with even the most complex and esoteric investment offerings on their own.

And at the other spectrum resides what might reasonably deemed as the "average" investor. Such an investor -- typically an individual -- does not have the money, resources and expertise to personally vet all investment opportunities. As one online overview notes, less sophisticated investors on the above-cited continuum have a "need for the protection provided by regulatory disclosure filings."

Financial regulators don't believe that so-called "accredited" investors require the same sort of hand holding.

The above-cited primer on accredited investors provides information that fleshes out the term and sets forth the requirements that both individuals and entities must satisfy in order to invest in securities that are not registered with the SEC.

It's really about risk and protection, with regulators wanting assurance that companies seeking to raise capital comparatively cheaply by avoiding regulatory filing requirements offer unregistered securities only to truly experienced and savvy business players.

Accredited investors are understandably a relatively limited demographic. The class includes persons who can demonstrate income and net worth at a qualifying level, as well as entities like banks, sizable business firms, investment advisers and brokers.

Detailed information on accredited investor requirements can be accessed through the above-supplied link.

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