The Supreme Court's Howey test defines ________ as an investment of money in a common enterprise with an expectation of profits solely from the efforts of others.

Question

Quizplus · Accepted Answer

While typical securities like common shares,preferred shares,bonds,and debentures are defined as securities,the definition of a security also includes many contracts that the general public may believe are not securities.This is because the term investment contract is broadly defined by the courts.The Supreme Court's three-part test for an investment contract,called the Howey test,has been the guiding beacon in the area for more than 50 years.The Howey test states that an investment contract is an investment of money in a common enterprise with an expectation of profits solely from the efforts of others.

The Supreme Court's Howey Test Defines ________ as an Investment