World market has moods which vary from time to time and the one who desires to be successful got to read the moods and adjust accordingly. Financial security is an important subject which demands guarantee of the investor’s money. Securities are of two types one is equity security and the other one is debt security. Securities need to be registered or regularized in a country where investment keeps coming and the stock market today is indulged in profit loss business. Securities are generally classified as issuer, currency of denomination, ownership rights, term to maturity, and degree of liquidity, income payments, tax treatment, credit rating, industrial sector, region or country, market capitalization.
Debt securities are generally divided as deposits, notes or commercial papers depending upon the maturity of the thought and many other characteristics. Within the term debt security there are short term and long term debt securities which have their own pros and cons. Likewise we have the Government bonds which fall in long term debt security as they do have lower rates as compared to the corporate bonds then there are Euro debt securities which are available to the complete international market as they are different from the issuers domicile and in continuation we have the super national bonds which deal with all the big shots like world bank and the international monetary fund. Apart from the debt security we have the equity security in the list which means to have a share in the capital stock of a company. The holder of equity is the share holder and unlike the debt security which require the regular payments the equity security mode of action is quite different. The glaring advantage of equity security is that they have the control over the business unlikely as of debt security and then the equity security does have the voting right.
Combination of both equity and debt security leads us to the formulation of hybrid security which is amalgamation of both. Their mode of operation revolves around the preference shares and the convertibles. These securities operate under an environment known as the primary and secondary security environment. In the primary security environment the money gets distributed amongst the investors and the security companies whereas in the secondary environment the money keeps fluctuating between the investors meaning by from one investor to the other. The topic under discussion has wide angles and further exploration demands that there are certain certificated or uncertificated securities like certificated security can be either bearer or registered and the investor has the right to go by the terms of its own whereas on the contrary the uncertificated securities operate electronically and the system of operation is more fast and fluid. The world financial market is fluid in nature and has the capacity to absorb the pressures and in turn judge the patience of the investors and the investment companies. Therefore sufficient knowledge about the strategies help the individual in reaching to the best available decision and to get the maximum.
Category: Business News