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It's not really a "wealth test". It's more of a "is this person likely to have proper legal counsel" test. Or at least that's how I understand its intent.
by m0zg 6y ago
It's not really a "wealth test". It's more of a "is this person likely to have proper legal counsel" test. Or at least that's how I understand its intent.
- gojomo 6y agoThe 'accredited investor' definition is absolutely & literally a "wealth test". It does not ask if you have legal counsel. Indeed, even being an investment-specialized, bar-licensed lawyer yourself, drafting agreements upon which other 'accredited investors' depend, wouldn't make you 'accredited'! But having $1,000,000 in the bank would. Prior wealth.
- m0zg 6y agoYes, but someone with $1M in investable capital will almost certainly have a lawyer and they will not be easily taken advantage of. I don't think you can require a lawyer per se in this country. I didn't come up with this myself - that's what Robert Shiller (of Case-Shiller index fame) says in his economics course, which I did take.