Investment Company

A corporation or trust whose primary purpose is to invest the funds of its shareholders.

An investment company is a firm that offers open-end funds, called mutual funds, closed-end funds, sometimes called investment trusts, or exchange traded funds to the public.

By describing a company offering the funds as an investment company, it's easier to distinguish the company from the funds that it offers.

For example, a single investment company might offer an aggressive-growth fund, a growth and income fund, a US Treasury bond fund, and a money market fund.

Or a closed-end investment company might offer an international fund focused on a single country, such as Ireland, or a region, such as Latin America.

SBICs (Small Business Investment Companies) and MESBICs (Minority Enterprise Small Business Investment Companies) are SBA-licensed, privately owned and operated investment companies which provide equity capital and long-term loans to independent business concerns. A MESBIC invests only in independent business concerns having at least 50 percent ownership by minorities.