Prospectus

A prospectus is the disclosure document that a fund, or a company registering securities for sale to the public, files with the Securities and Exchange Commission, the federal agency that regulates securities markets. It describes the investment objective, what the fund holds, the costs, the risks.

A standardized fee table lists the expense ratio, the yearly percentage the fund takes from its assets. Any sales charge, a fee you pay when you buy or sell shares, appears separately in that table. Funds also show what your costs would be over several time periods on a $10,000 investment, assuming a 5 percent return each year.

Many funds provide a short summary prospectus, with the full document available free. A prospectus sets out terms and risks; filing it does not mean SEC approval, and it promises nothing about future returns.