Speculative Security Law and Legal Definition

Speculative security is a stock, bond, or other security the value of which materially depends on proposed or promised future promotion or development.

Section 2 of the Blue Sky Law defines the term "speculative securities", as including stocks, bonds, notes, contracts or other securities which shall, in their subscription, issuance, sale, transfer, negotiation or distribution, be represented to yield a profit to the purchaser or other transferee of more than eight per cent on the price at which they are offered. [Superior Producing & Ref. Co. v. Handlan, Hearne & Co., 100 W. Va. 547, 548 (W. Va. 1926)].