An investor who either alone or together with his, her or its purchaser representative, has sufficient knowledge and experience with financial and business matters that the investor can evaluate the risks and merits of a contemplated investment.

This term is often used to refer to this type of investor generally. Depending on the context, it can also be used to refer to groups of sophisticated investors that are specifically defined in the Securities Act such as accredited investors (including institutional accredited investors) or qualified institutional buyers.

See Practice Note, Unregistered Offerings: Overview for a discussion of the role of sophisticated investors in private placements.