The Howey test determines whether or not something is an investment contract, a type of security. By extension, this often determines whether or not something is a security.
Invest Money
The motivation should be to invest money, not just exist as a requirement for something else.
Broad vertical commonality is present when there is a connection between the efforts of the promoters and the collective successes and losses of the investors.
This is probably not correct because it is basically the same thing as the "efforts of others" element of the Howey test.
Different states accept different types of commonality.
Expectation of Profits
Efforts of Others
For selling a corporation's "stock" (or other instruments listed in the statute), Landreth says that it will be considered a security as long as it bears the normal indices of that type of instrument.
Despite being largely equivalent, purchasing all of a corporation's assets is not a security sale, but purchasing all of a corporation's stock is a security sale.
Sometimes purchasing just the assets will allow one to escape liabilities but may terminate contracts.
Generally, interests in general partnerships are not securities (unless they don't really have the ability to manage), and interests in limited partnerships are securities.
Purchasing all of an LLC, it's not clear exactly what happens. Purchasing part of an LLC uses the investment contract analysis, and will mostly depend on how active the purchaser is in the business. An active manager will not have a security.
Since notes are listed in the statute, they are securities by default. However, Congress clearly could not have meant all notes. Thus, the courts have come up with the family resemblance test. There are certain families of notes that Congress could not have meant, so to the extent that a note resembles one on the list, it is not a security.
The Supreme Court in Reves identified four factors to consider in comparing similarity and contemplating adding to the list:
The motivations for entering into the contract.
A seller looking to raise money for his business and a buyer looking to make a profit would indicate a security.
Facilitating the purchase of a minor asset or consumer good, correcting for the seller's cash-flow difficulties, or advancing another commercial or consumer purpose is likely to not be a security.
The "plan of distribution" of the instrument to determine if there is a "common trading for speculation or investment."
The reasonable expectations of the investing public.
Whether some factor such as the existence of another regulatory scheme significantly reduces the risk of the instrument.