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What is a prospectus and a profile prospectus for mutual funds?

Last Updated: March 06, 2008

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A prospectus is document required to be given to investors by investment companies to disclose important information such as a mutual fund's objectives, historical performance, and expenses. Companies are required to update their prospectuses annually. Often, prospectuses are 20 to 30 pages or more in length. A profile prospectus is a streamlined version of a prospectus that summarizes fund information succinctly, often in a question-and-answer format on one doubled-sided page. Both types of prospectuses are often available for downloading from investment company Web sites, or they can be mailed to investors on request.

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