In most states, minors do not have the right to sign contracts, so they cannot own stocks, bonds, mutual funds, etc. However, two pieces of legislation--the Uniform Gift to Minors Act (UGMA) and Uniform Transfer to Minors Act (UTMA)--established a simple way for adults (usually parents) to open up custodial accounts. With this type of account, adults can save and invest money on behalf of a minor, until the minor reaches a certain age (somewhere 18-25, depending on the state), when the account must be transferred to them.
UGMA accounts allow minors to own stock, bonds, and other securities
UTMA accounts allow minors to own other types of assets too, like real estate, fine art, patents, and royalties
For the purposes of the FAFSA®, the UGMA/UTMA custodial accounts are owned by the person who will eventually get it, not the custodians. (In general, this means, it’s owned by the student, not the parents. Therefore, the balance in these accounts should be considered as part of the “net worth” of the student, not of the parent.)