Your finance guide: Debt securities explained

Debt securities, or bonds, are there to help you with your investments

13:27 29 January 2013

Finance can be often difficult to understand, especially if you’re new to investing. Although professional help is out there if you want to confirm what securities you have in place. Securities can include shares and bonds and the aim is that they can be used by individuals in investment.

The outcome can be that the investor receives capital gain or an income.

Securities explained

 

There are two main types of securities:

 

a)      Debt Securities

b)      Equity Securities

What are debt securities?

 

Debt securities are often referred to as investment bonds, and these run alongside equity securities (which relates to stocks and shares).

How do they affect me?

 

Debt securities are one type of security you can have with your investments. They work by being bought and sold in the market in order for an investor to ‘borrow’ money.

 

Debt securities are often fixed-term securities and appeal to many investors because they are quite often seen to have a higher return rate than say a bank deposit.

 

Also, many people who are interested in investing, which is often one way a person can look to make money, may view debt securities as having lower interest rates than other options.

 

They can help you if you need help with your finances, especially if your plans involve ways to help you secure your finances for the future.