1: securities definition
2: security types
3: it’s works
4: security contain
Quick Pick :
All the publicly trading items such as stock, bonds, commodities, option, futures with protection of government agency are considered as securities.
Security means the protection of one things from any cheating, fraud, scam, malware extra…
Without security it doesn’t matter whatever the shops, materials, software, contract, money extra…
nothing is protected from any damages.
this article occupied the information about what is really mean security in the stock market, and what are the securities types and how it’s works and helps traders and investor around the world.
1: securities definition
In stock market there are tens and hundreds of items and pairs are trades among the investors which is equity shares of stock, commodities, bonds, option, futures, digital currency and much more.
If someone bought the shares of stock from the stock exchange or through broker in exchange, there is no guaranteed certain stock or any others materials would not be cheat or fraud on the market.
So before the 1930s lots of countries banned the stock market because of lack of protection of security for the any bought items.
Therefore the federal government of USA formed the security and exchange commission (SEC) on 1934 in the stock market which they also called as SEC.
Followed by them lots of countries started to formed the security and exchange commission on each and every country which are completely run and based on the federal government.
So the SEC created strong regulations around the stock market to protect investors from the any fraud and any kinda of cheating on the public market.
SEC notify each financial items trades in the public market must have to register and approve by security and exchange commission. It doesn’t matter it’s a equity of shares or commodities, bonds or anything.
Once these any financial instruments is register on SEC means then the SEC gave strong security which is protection for all investors who bought the public financial instruments items.
So the each financial instruments item are guaranteed for trading and making money on the stock market because of SEC protection.
That’s why this all financial items are become the security provided item for the general public. So anyone could buy and sell these items without the fear of Fraud or scam in the market.
So the registered financial instruments are become secured after the approval of SEC. That’s why these all financial items of equity shares of stock, commodities, bonds, option, futures, digital currency extra are called as securities in the stock market.
Today securities are trade among millions of traders and investors around the world. So let’s now have look on securities types.
2: securities types
There is no big difference in the Securities types. All the public financial instruments are called as securities.
When the purpose of organization item is differentiated then the security of the item also differentiated.
There is commonly four types of securities in the market
Equity securities,
Debt securities,
Derivatives securities
And other securities.
Equity securities are the shares securities which are ownership of share piece in the public company to trade among investors.
Debt securities are the bonds which is paid through fixed interest on term basic until it’s become mature, where this debt securities are provided by any public Corporation or governments.
Derivatives securities are the options and contract futures, where contract between two parties to buy or sell the any equities, debt or commodities securities at predetermined future price.
Then other securities are Convertible securities which are like when investors purchase the certain bond or preferred shares of stock.
The investor would able to covert that debt or bonds securities into common shares of stocks during the time of holding a preferred stock or while receiving the interest on debt.
These are the type of securities
So now let’s look on how these all types of securities are works.
3: it’s works
This all kind of securities are listed through the stock exchange and bought by big institutional investors and by general small public investor through brokerage.
The securities are provided and issued by different organization on different circ*mstances.
But when the securities are bought by initial investor and it doesn’t sold back to organization, instead the initial investor securities are sold to other investor for high or low purchased price of Initial investor.
So the all the securities are traded among the public investors but not among the direct investor to organizations.
The securities issued organization got the money from initial investors for their securities and the initial investor exchange to second investors, then second investors exchange to others investors and so on, by using their money through stock market exchange.
To make a more clear about the security let’s have a look on what’s securities today actually contains.
4: securities contain
It doesn’t matter whatever the public securities are bought by investors. It’s all holds some value behind every securities.
It’s depends upon the Securities people’s own, if the investor own equity securities then the equity security hold the value of piece of real ownership of public organization.
Or if investor purchase the debt securities, then it’s not a simply securities but it’s hold the value of fixed interest payment from the issuer.
So each public securities contain some value behind it. It’s contain value until the certain securities gets hold or mature, by investors.
Market rule: #100134
Securities are the market rule, which these securities are the basic things that issued and helps to trade the value for the investors. Using the securities any method or strategy you perform are completely responsible from your side.
If your investors and not comfortable or align investing with based on market rules please learn about how to regulate your investments under your control with use of Rule investing.
