Introduction

Welcome to Key Definitions Under the Uniform Securities Act (USA), the unit that gives you the vocabulary you need to understand every other topic on the Series 63 exam.

Exam Weight: Foundational (tested across all sections)

What You'll Learn

In this unit, you'll cover:

• Definition of "Person": Who counts as a "person" under the USA (and who does not)
• Definition of "Security": The broad statutory definition and the four-prong Howey Test for investment contracts
• What IS a Security: The full list of instruments that qualify as securities
• What is NOT a Security: Insurance products, commodities, real estate, and other exclusions
• Offers and Sales: When a transaction counts as an "offer" or "sale," plus important exceptions
• Issuers and Non-Issuer Transactions: The critical distinction between primary market and secondary market transactions

Why This Matters

These definitions are the building blocks of state securities law. Nearly every exam question depends on knowing whether something is a "security," who qualifies as a "person," and whether a transaction is an "offer" or "sale." Get these definitions right and the rest of the exam becomes far more intuitive.

Let's start with the broadest definition: who counts as a "person" under the USA.