Series 63 practice questioneasyHowey Test Application
The Howey Test is used to determine whether which of the following is present?
- AAn investment contract✓ Correct answer
- BA fixed insurance policy
- CA government bond
- DA commodity future
Explanation
Why A — An investment contract
The Howey Test determines if a financial arrangement constitutes an investment contract, and thus a security, under the USA and federal law. The other options are either not securities or determined differently.
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