The Investment Company Act of 1940 is an act of Congress that regulates the organization of investment companies and the activities they engage in. It sets standards for the investment company industry. A primary purpose of the Act is to protect investors by ensuring that they're aware of the risks associated with buying and owning securities.

Investment companies are required by the Act to provide investors with information about their investment objectives, investment policies, and financial condition when stock is first sold and, henceforth, at regular intervals.