The correct answer is <u>both Debt and Equity.</u>
Debt and equity are the two major types of securities. However, securities refer to a financial instrument that can be traded
<h2>Further Explanation</h2>
However, there 3 categories of securities, they are:
- Equity securities (e.g. stocks)
- Debt securities (e.g. banknotes, bond) is also known as fixed-income securities
- Hybrids securities
Equity securities also mean stock. It also refers to the amount of share an individual has in a company. This type of securities generates regular income for shareholders. The income is also in the form of divided. However, equity security can rise or fall and this condition depends on the company’s fortunes or the direction of the financial market.
Debit securities entails borrowed money and also the selling of a security. Companies or individuals can issue debt security for a particular amount with a guarantee to pay back with interest.
Debt securities include the following:
- The certain fixed amount that must payback
- The certain interest rate that must be payback with the fixed amount
- The maturity date, which is the date the total amount of securities, should be paid
Hybrids securities are the combination of the characteristics of the 2 other types of equities (both equity and debts)
Examples of Hybrids securities include
- Preference shares
- Convertible bonds
- Equity warrants
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KEYWORDS:
- securities
- investments
- debt
- equity
- examples
