How SEC regulates stock market?
Securities and Exchange Commission (SEC) is independent U.S federal agency that regulates the stock market. It was created in 1934 by Congress to help restore investor confidence after the 1929 stock market crash. The Securities Exchange Act of 1934 was created by Securities and Exchange Commission. It govern securities transaction on the secondary market relying on Securities Act of 1933 which increased transparency in financial statements and established laws against fraudulent activities. In essence SEC provides transparency by ensuring accurate and consistent information about companies that allows investors to make informed and sound decisions. Without transparency stock market would be vulnerable to market speculation and creation of asset bubbles. Securities and Exchange Commission has five commissioners and five different divisions: Division of corporate finance - review corporate filing requirements ensuring that investors have complete and accurate information on compa