Posted in Finance, Accounting and Economics Terms, Total Reads: 30
Definition: Registered Security
Registered Security is the security / stocks/ bonds which are registered in the name of the investor who has bought these securities. The owner’s name is recorded with the issuer or agent of the security.
Once the security is registered to its owner, that security is not available for sale in the market. However, the ownership of the registered security can be transferred to another person only with the endorsement of the security by the current registered owner.
There can be two types of registration for a Registered Security,
• Manual Registration, wherein the name of the owner is printed on the certificate which is provide with the securities.
• Electronic Registration, wherein the name of the owner of the security is listed in the database.
Advantage of Registered security is,
• The issuing company has all the information about the owner of the security, hence it is easier to pay dividends and also any other important information / notice related to the company.
Currently, in today’s market almost all the securities which are traded are registered securities.