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securities transactions

A security is a financial asset that can be bought and sold—including stocks, bonds, debentures, municipal securities, futures, and options—and a securities transaction involves the purchase, sale, redemption, or other transfer of a security.

In Texas, securities are regulated by both state and federal law. The Texas Securities Act governs the issuance, sale, and transfer of securities within the state. This Act requires the registration of securities, as well as the licensing and regulation of brokers, dealers, investment advisers, and their representatives. It also includes provisions to protect investors from fraudulent practices and provides the State Securities Board with enforcement authority. At the federal level, the Securities and Exchange Commission (SEC) regulates securities transactions nationwide, enforcing laws such as the Securities Act of 1933 and the Securities Exchange Act of 1934. These federal laws mandate the disclosure of important financial information, prohibit deceit, misrepresentations, and other fraud in the sale of securities. Both state and federal regulations are designed to promote transparency, ensure fair dealing, and protect investors in the securities market.

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