Answer:
If it is registered as an Investment Company under the Investment Company Act of 1940
Explanation:
The Investment Company Act of 1940 represents a Federal Government regulation that is recognised by the 1933 Securities Act. According to the Investment Company Act, a mutual fund is considered a federal covered security when it is registered as an investment company.
An investment company represents a trust or a corporation whose main business is to invest the pooled capital of investors in financial securities. Investment companies carry out their business either through an open end fund or a closed end fund.
