The world of investing is complex, fascinating, and it can also be very fruitful. However, it's not like banking and there are no guarantees. Stocks, bonds, and other securities can lose as well as gain value. A good way for investors to protect the money they put in securities markets is to research and ask questions. Becoming very knowledgeable of stocks and businesses can be very beneficial to and investor. All investors, whether large institutions or private individuals should have access to certain basic facts about an investment before buying it.
The U.S. Securities and Exchange Commission (SEC) makes sure that all investors are provided with those facts and information. They have passed a series of acts since 1934 to ensure fair, and even playing fields for investors. .
The Securities Act of 1933 consisted of two basic objectives:.
Require that investors receive financial and other significant information concerning securities being offered for public sale.
Prohibit deceit, misrepresentations, and other fraud in the sale of securities.
An important way to accomplish these goals is the disclosure of important financial information through the registration of securities. This information allows investors, not the government, to make informed judgments about whether or not to purchase a company's securities. While the SEC requires that the information given is accurate, it does not guarantee it. Investors who purchase securities and take loses have .
recovery rights if they can prove that there was incomplete or inaccurate information given.
Securities sold in the U.S. must be registered. Registration Forms call for:.
A description of the company's properties and business;.
A description of the security to be offered for sale;.
Information about the management of the company;.
Financial statements certified by independent accountants.
The Securities Exchange Act of 1934 is how Congress created the SEC.