accredited investor

Definition

US Securities & Exchange Commission (SEC) term for a person who has individual or joint (with her or her spouse) net worth of over one million dollars, or whose individual annual income exceeded $200,000 ($300,000 in case of joint income with the spouse) in each of the two most recent years and there is a reasonable expectation of maintaining the same income level in the current year. An accredited investor is exempt from being counted as one of the maximum 35 investors in a private limited partnership. He or she, however, must invest at least $150,000 in the partnership and the invested sum must not exceed 20 percent of his or her net worth.