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Securities

Securities are financial instruments that represent ownership in a company (equity securities, like stocks) or a debt obligation (debt securities, like bonds). Securities can also include derivatives, such as options or futures. They are tradable assets that investors buy or sell in financial markets to achieve capital growth, earn income, or hedge against risk. Securities are subject to regulation to ensure transparency, protect investors, and maintain market integrity.

Example:

An investor purchases shares of a publicly traded company, which are considered equity securities, providing ownership in the company.

Key points

Financial instruments representing ownership (stocks) or debt (bonds).

Include equity securities, debt securities, and derivatives like options.

Traded in financial markets to achieve capital growth, earn income, or hedge risk.

Quick Answers to Curious Questions

The main types are equity securities (stocks) and debt securities (bonds), along with derivatives like options and futures.

Securities are regulated to ensure market transparency, protect investors from fraud, and maintain the integrity of financial markets.

Investors buy securities to gain ownership in companies, earn income through dividends or interest, or hedge against market risk.

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