Scope
The act's purpose, as stated in the bill, is "to mitigate and... eliminate the conditions... which adversely affect the national public interest and the interest of investors." Specifically, the act regulated conflicts of interest in investment companies and securities exchanges. It seeks to protect the public primarily by legally requiring disclosure of material details about each investment company. The act also places some restrictions on certain mutual fund activities such as short selling shares. However, the act did not create provisions for the U.S. Securities and Exchange Commission (SEC) to make specific judgments about or even supervise an investment company's actual investment decisions. The act requires investment companies to publicly disclose information about their own financial health.
Read more about this topic: Investment Company Act Of 1940
Famous quotes containing the word scope:
“A country survives its legislation. That truth should not comfort the conservative nor depress the radical. For it means that public policy can enlarge its scope and increase its audacity, can try big experiments without trembling too much over the result. This nation could enter upon the most radical experiments and could afford to fail in them.”
—Walter Lippmann (1889–1974)
“In the works of man, everything is as poor as its author; vision is confined, means are limited, scope is restricted, movements are labored, and results are humdrum.”
—Joseph De Maistre (1753–1821)
“For it is not the bare words but the scope of the writer that gives the true light, by which any writing is to be interpreted; and they that insist upon single texts, without considering the main design, can derive no thing from them clearly.”
—Thomas Hobbes (1579–1688)