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.
.
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.
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.
.
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.
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