Tools Of The Trade: Securities

Securities are investment vehicles or financial instruments that represent ownership of debt, publicly traded companies or rights of ownership.

The following are securities for each common investment topic:

• Public Company Equity: Stocks
• Public Company Debt: Bonds
• Rights of Ownership: Options

Related Link: Terms Of The Trade: Top Line And Bottom Line

Securities are often tradeable and are monitored in the United States by the Securities Exchange Commission. They also provide public companies and governments with the ability to raise capital or debt from the public.

The U.S. government, for example, sells government bonds (a type of security) to raise money for government projects and welfare. In return, owners of these bonds expect interest and principal from the government in the future.

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