Prospectus

A prospectus is a formal legal document that companies and investment funds use to describe the main features of financial security for potential buyers. It is a detailed document that must be filed with regulatory bodies, such as the Securities and Exchange Commission (SEC) in the United States, before securities can be offered to the public.

The prospectus contains vital information about the investment offering, allowing investors to make informed decisions. It typically includes details about the company's business model, financial statements, biographies of management and directors, detailed information about the offering, and any risks associated with the investment.

The primary purpose of a prospectus is to disclose essential facts and figures to protect investors from fraud and to promote transparency in financial operations.