Commodity futures trading - Unfortunately, too many investors do not read the prospectus, or cannot understand the most elementary financial language.
Since 1933, the prospectus has undergone many changes. Today, it is a streamlined document, generally brief, and written as simply and clearly as the subject matter permits. The Commission has gone far to prevent the prospectus from being misleading even though it is a selling document intended to persuade the prospective investor. In an early proceeding, the Commission decided that the type used to name the custodian of an investment company was so prominent that it presumably was intended to impress the reader with the standing of the financial institution and lead him into thinking that the custodian would have a voice in the fund's management. Revision was required. The prospectus generally contains the following information about the fund: its objectives and features, investment policy, the securities being offered, management personnel, dividends and capital gains distributions, investment powers and restrictions, redemption or repurchase of shares, pricing of shares, portfolio, and financial statements, including a record of per share income and changes in net asset value.
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