A market in which an investor purchases an asset from another investor, rather than an issuing corporation. A good example is the New York Stock Exchange. All stock exchanges are part of the secondary market, as investors buy securities from other investors instead of an issuing company.
Securities and Exchange Commission (SEC).
A government commission created by Congress to regulate the securities markets and protect investors. In addition to regulation and protection, it also monitors the corporate takeovers in the United States. The SEC is composed of five commissioners appointed by the President of the United States and approved by the Senate. The statutes administered by the SEC are designed to promote full public disclosure and protect the investing public against fraudulent and manipulative practices in the securities markets. Generally, most issues of securities offered in interstate commerce, through the mail, or on the Internet, must be registered with the SEC.
Securities Investor Protection Corporation (SIPC)
A nonprofit corporation that insures investors against A nonprofit corporation created by an act of Congress to protect the clients of brokerage firms that are forced into bankruptcy. Membership is composed of all brokers and dealers registered under the Securities Exchange Act of 1934, all members of securities exchanges, and most NASD members. SIPC is an insurance that provides brokerage customers up to $500,000 coverage for cash and securities held by the firms (although coverage of cash is limited to $100,000).
The right to buy newly issued shares ahead of the general public in order to maintain current proportion of ownership in a company.
Share ownership of a corporation.