Series 51: The Securities Exchange Act Of 1934

The Securities Exchange Act of 1934

The Securities Act of 1933 regulates how securities are registered, issued, and distributed to the public for the first time—the primary market. In contrast, the Securities Exchange Act of 1934 regulates the reselling of securities—the secondary market.

For the Series 51, there are four major pieces of information that you need to know about the 1934 Exchange Act:

• • It contains important trading laws—including laws on insider trading.
• • It allows securities exchanges to regulate themselves (e.g., New York Stock Exchange)—under the condition that they register with the Securities and Exchange Commission (SEC) and devise a set of rules consistent with the Act’s specific guidelines.
• • It created the SEC to be the body primarily responsible for the creation and enforcement of securities laws.
• • It requires brokers and dealers to register with a registered national securities association. Like the exchanges, the association would register with the SEC and devis