Over 700 finance terms, Shmooped to perfection.
Accredited investors are simply investors who qualify to do a certain investment. Usually accredited" means that they have... credit. Or assets. Or wampum. Or "chee" (knowledge, balls) which means that they are big boys and girls who are able to invest a large amount of money in a risky venture.
Officially, they are investors who have an income of at least $200,000 for the past two years ($300,000 for joint accredited investors), OR have a net worth of at least $1,000,000 (individually or jointly), OR are executives, partners or directors of the entity issuing securities. Institutional investors such as mutual funds, hedge funds and pension funds also fit the bill.