Types of Securities.

Normally people want to invest their money in different security and earn more money. They allow you to grow your money and expand your business or making more money for using after retirement.

There are different types of security but the main two kinds of security. Equity securities make you a partially ownership of the company. Debt securities are such securities which makes loan to companies, government and other institution.

Equity securities.

Common Stock.

The common stock is the equity stock in which the buyer the purchase such stock which transfer the risk and ownership of company to buyer. This type of stock holder have a right to of voting to select the Board of Directors in the company. The dividend is paid on such shares according to the profit the firm.

Preferred Stock.

The preferred stock is also like the common stock. Normally these type of stock have high price than common stock and have a preference on common stock in profit sharing. The profit sharing ratio is fixed on such stock and have no voting right. But after dissolution of company they have also preference on the assets of company after paying the debt to such stock holder than to the common stock holder.

Debt Securities.

Bonds.

A bond is an investment make by investor to the company in shape of debt for a specific period of time with a fixed rate of return on it. It used by government and companies to make financing the project and and activities. Bonds can be resold in the capital market in whole world. Normally the big firm and the government issued the bonds to finance the big project which needed the large amount of money.

Municipal Bonds.

The municipal bond is normally local government and agencies with the fixed rate of return. The government used such bonds to make the project in the country.

Corporate Bonds.
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The corporate bonds is issued by the corporation for raising money to expand the business. These are normally called as the long term debt instrument. Normally these type of bond have a fixed rate of return.

Types of Financila Security Market.

Financial Security Market.
There are two different types of financial security market.

Primary Market.
The primary market is such types of market in which the companies issued there financial security like common stock, ordinary stock, and preferred stock first time in the market is called the primary market. The companies used the this market to issues the initial stage of companies shares in the market.
The function is provided by the broker and financial institution   to issues the initial shares of the companies.


Secondary Market.
The secondary market is such type of market in which the company issues there shares first time and trade in the secondary market where the resale and purchase of security is held. This market provide the facility to the stock holder to re-trade the share in the market. The function is provided by regulation authority of the country. The stock exchange is done the function of secondary market.

What is Security.

Security.
A security is any thing in financial instrument that represent the ownership in the financial market or stock market. It is the creditor relation with the company, corporation, and government bodies a right the ownership in the company equal to the security. It is negotiable and have value. The organization or company is normally issued the security and the also known as the issuer. And the buyer is known as the holder of the security.

What is Financial Risk Management?

Definition.

Financial risk management means using the economic value or financial instrument to meat the exposure of risk mainly market risk and credit risk. The financial risk management cannot meat all the possible risk to the firm it must evaluate, identify all risk and make some precaution to handle that risk. There must some policy or procedure to handling it. The top management must written the policy that how much the financial risk is taken and handle. They must risks taken and generate reports to evaluate risk and making timing decision.

What is Risk and Types of Risk.

Risk and Types of Risk.

Risk mean to a threat to lose or expose to some thing. A situation where a possibility to lose your investment. Any other situation which is harmful or negative to your business like damage, liability, or loss to your organization.

The basic types of risk.

• Systematic Risk. Systematic risk is such type of risk which is unavoidable and have an influence over the large amount of assets of an organization. This risk have huge impact on your assets in portfolio. It is very difficult to protect yourself from this type of risk.

•  Unsystematic Risk. Unsystematic risk is the assets specific risk. This risk effect the very small amount of assets in your portfolio. The daily changes in the prices of stock market will effect the asset value. The diversification is the only way to avoid this type of risk or minimize the risk.

•  Market Risk. Market risk is such risk which is known to every one the daily changes and fluctuation in the prices of the stock. The volatility makes the investor to make the profit from the stock. This risk is mainly applies in options and stocks.

What is Financial Management?

Financial Management. 

It Refers to the management of financial resources effectively and efficiently in such a way that leads to accomplish the overall objectives of the organization. The function require the specialized skills which is normally done by the top management or Board of Director (BOD).
It is also the planning, organizing, directing and controlling of financial activity such as the utilization of resources.

What Is Finance? Definition and Meanings.

Finance.

Definition.
The finance means the management of the large amount of money like big organization.
Also means to provide the money to the person, business or Enterprise.
It is the branch of economic and deals with the money and allocation of the resources like investing and acquisition. It also deals with money market and availability of equity and debt to the business organization.
The company can raise the finance through the sale of shares to public.