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An accredited investor is an individual or a business entity that is allowed to trade securities that may not be registered with financial authorities. They are entitled to this privileged access by satisfying at least one requirement regarding their income, net worth and asset size. Accredited investors are deemed financially sophisticated enough to bear the risks. For an individual to be accredited, the person must have a net worth of $1,000,000 excluding the value of his primary residence. For other entities, the net worth threshold varies.

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