Legal Definitions - sophisticated investor

Definition: A sophisticated investor is someone who has enough knowledge and experience in financial matters to evaluate the qualities of a security without requiring the full protection of securities laws.

Examples:

• An individual who has been investing in the stock market for many years and has a good understanding of how it works.
• A financial advisor who has a degree in finance and has been working in the industry for several years.

These examples illustrate the definition of a sophisticated investor because they both have the knowledge and experience necessary to evaluate the qualities of a security without requiring the full protection of securities laws. They are able to make informed decisions about their investments based on their expertise in financial matters.