Financial Asset Law and Legal Definition
Financial assets are the intangible representation of monetary value. They are mostly in the form of financial claims like bonds, stock, and money in the bank.
Following is an example of a federal statute defining financial asset.
According to U.C.C. § 8-102 (9), financial asset, means:
(i) a security;
(ii) an obligation of a person or a share, participation, or other interest in a person or in property or an enterprise of a person, which is, or is of a type, dealt in or traded on financial markets, or which is recognized in any area in which it is issued or dealt in as a medium for investment; or
(iii) any property that is held by a securities intermediary for another person in a securities account if the securities intermediary has expressly agreed with the other person that the property is to be treated as a financial asset under this Article. As context requires, the term means either the interest itself or the means by which a person's claim to it is evidenced, including a certificated or uncertificated security, a security certificate, or a security entitlement.
Financial assets are also known as investable assets. Unlike real estate or gold that are tangible assets, financial assets are non-physical in nature.
