Financial Security Services
Securities are tradable assets representing ownership in a financial instrument. Common examples include stocks, bonds, and derivatives. These securities enable investors to buy, sell, and trade financial assets in capital markets, facilitating investment, and risk management
- Equity securities
- Debt securities
- Hybrid securities
- Derivative securities
- Asset-backed securities
Types Of securities:
Types of Securities:
Equity Securities
Equity securities, commonly known as stocks or shares, represent ownership in a company.
Investing in equity securities carries the potential for high returns, but it also comes with a higher level of risk compared to other types of securities.
Debt securities
Debt securities, on the other hand, represent loans made by investors to governments, corporations, or other entities. These securities include bonds, debentures, and notes.
Debt securities are considered lower-risk investments compared to equities, as they offer a predictable stream of income and are backed by the issuer's creditworthiness.
Hybrid securities
Hybrid securities combine features of both equity and debt securities. Convertible bonds and preference shares/ preferred stocks are common examples of hybrid securities
Preferred stocks, while similar to common stocks, offer preferential treatment in terms of dividends and liquidation proceeds, making them a middle ground between equity and debt investments.
Derivative securities
Derivative securities derive their value from an underlying asset, such as stocks, bonds, commodities, or currencies. Options and futures contracts are prominent examples of derivatives
Derivatives are commonly used for hedging against price fluctuations, speculating on market movements, and managing risk
Asset-backed securities
Asset-backed securities (ABS) are financial instruments backed by a pool of underlying assets. These assets can range from mortgage loans and auto loans to credit card receivables.
Mortgage-backed securities (MBS). For instance, pool together various mortgages and provide investors with a share of the interest and principal payments from these mortgages.