Tag Archives | secondary market

Securities Exchange Act of 1934

See Also:
Secondary Market
Securities Act of 1933
New York Stock Exchange (NYSE)
Primary Market
Sarbanes Oxley Act of 2002 (SOX)

Securities Exchange Act of 1934

The Securities Exchange Act of 1934 deals with the regulation of secondary market transactions, or outstanding securities in the market (which can be traded on a daily basis). The Securities and Exchange Commission (SEC) regulates this act.

Securities Exchange Act of 1934 Meaning

The Securities Exchange Act of 1934 was established after the stock market crash of 1929 – the following Great Depression. The 1934 Securities Exchange Act is meant to provide meaningful and relevant information to the average investor. This ensures that the investor is not mislead in anyway so that they are able to make well informed decisions. The Securities Exchange Act regulations include the need for quarterly and annual audits by an accounting firm. These accounting firms then attest to the accuracy of the statements.

The Securities Exchange Act of 1934 thus ensures that there is no fraud that exist within the company. It also deals with insider trading. If an investor has information that is non-public in nature then, then under the 1934 Securities Exchange Act, he/she may not act on it until the information has gone public. The idea is to provide a fair and equal market so there are no unusual transactions to set the market adrift.

securities exchange act of 1934

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Secondary Market Definition

See Also:
Securities Exchange Act of 1934
Secondary Market
Primary Market
Securities Act of 1933
New York Stock Exchange (NYSE)

Secondary Market Definition

A secondary market definition is the trading of already issued securities – the primary market. Furthermore, the Securities Exchange Act of 1934 regulates these securities.

Secondary Market Meaning

Many know secondary markets better than the primary markets. This is because the secondary markets are more readily available to the average investor. They are also often in the form of exchanges. The New York Stock Exchange (NYSE) or the National Association of Securities Dealers Automated Quotations (NASDAQ) are examples of this type of exchange. Then, these are regulated by the Securities and Exchange Commission (SEC) under the 1934 Act of Securities Exchange. Furthermore, this is to ensure the accuracy of the companies whose securities are trading on the market.

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secondary market definition

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secondary market definition

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Fixed Income Securities

See Also:
Long Term Debt
Maturity Date
Non-Investment Grade Bonds
Owner’s Equity
Par Value of a Bond
Preferred Stocks
Core Satellite Portfolio

Fixed Income Securities Definition

What are fixed income investments? Fixed income securities are financial instruments that represent debt obligations. A company, government, or other organization can raise funds by issuing debt instruments to investors. The issuing entity agrees to make periodic interest payments to the investor. Then the issuing entity repays the principal amount at the end of the contract.

With debt instruments, the issuer is essentially borrowing money from the investor. The investor plays the role of a lender lending money to the issuing entity. Debt instruments also represent a claim on the assets of the issuing entity. In addition, you can trade fixed income securities on secondary markets. Many often call debt securities fixed-income securities. This is because the issuer often predetermines the terms of the debt instrument.

For example, a debt instrument will be issued with a certain maturity, a certain principal amount, and a set coupon rate; however, while debt securities are often called fixed-income securities, this does not mean they yield a fixed stream of payments. In fact, debt securities’ returns can fluctuate and vary.


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Fixed Income Yield

Now, refer to fixed income yield as the return on the instrument. Fixed income investments issued by companies with poor credit or a higher risk of default will have higher yields than fixed income securities issued by companies with good credit or less risk of default. As a result, higher yields on riskier fixed income investments compensate the investor for the higher risk of default. Short-term debt instruments often have comparatively lower yields. Whereas, longer-term debt securities often yield higher returns than short-term debt or money market instruments.

Fixed Income Security Examples

You can issue debt instruments either publicly or privately. In addition, you can often trade them on financial exchanges. Some examples of debt securities include the following:

fixed income securities

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