- Financial Advisory
- Financial Dictionary
In stock market terminology, the term Securities refers to investment instruments of any kind, some of which represent ownership in corporations like stocks, and that are generally traded on secondary markets. Securities include: stocks and bonds, futures contracts, mutual funds and options.
For example, Securities offer the possibility of making investment capital available for businesses to expand and for businesses to not only issue equity to raise money, but also to borrow money through the issuance of corporate bonds. Also, Securities allow investors to participate in the above average returns which are often made with these types of investments. Derivative products are also known as securities, and options and futures contracts allow for the leveraging of the underlying assets, which make these types of Securities extremely popular. Because investing in many Securities actually entails taking a certain amount of risk, using the term “Security” to describe them may actually be a misnomer.
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