United States definition of securityhowey test

SEC v WJ Howey Co

328 U.S. 293 (1946)

JurisdictionUnited States

CourtSupreme Court of the United States

Year1946

StatusBinding authority

Key Principle

An 'investment contract' that is a security under the Securities Act of 1933 exists where there is (1) an investment of money (2) in a common enterprise (3) with a reasonable expectation of profits (4) to be derived from the entrepreneurial or managerial efforts of others.

Area of Law

corporate

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