The smallest investment amount accepted for establishing a new account.
Benefits
The minimum initial purchase notifies the investor of monetary restrictions for becoming a shareholder. Generally speaking, institutional funds have the highest minimum initial purchase amounts. For those investors with only a small amount to invest, checking the fund’s minimum initial purchase should be one of the first criteria you use when selecting an appropriate mutual fund.
Origin
This information is taken directly from the fund prospectus.
For the Pros
Some funds have lower minimums for children (i.e., custodial account), but this is usually in conjunction with a continued investment plan. Some funds with high minimum initial purchases are available at lower minimums through discount brokers.