1940 Act

The Investment Company Act of 1940 is U.S. federal legislation that regulates mutual funds and investment companies. It requires these entities to operate transparently, disclose financial information regularly, and act in the best interests of their investors. The Act aims to prevent mismanagement, conflicts of interest, and fraud, ensuring that investment companies are held accountable and investors are protected. It establishes standards for registration, reporting, and governance, promoting trust and stability within the investment industry. Overall, it helps ensure that collective investment vehicles operate fairly and responsibly in the financial market.