The concept of securities



Contents

  • 1 Securities
  • 2 The importance of securities
  • 3 types of securities
  • 4 conditions of attractiveness and efficiency in the stock market

Money bills

The term securities are called all securities and sukuk issued by government and civil public bodies, and private companies, such as insurance companies and private hospitals, so they are given to the person who owns them with the authorities that issue them, and they are distinguished by the fact that they are issued at the same value unlike commercial papers whose value often changes.

Sellers and buyers usually meet in a physical or virtual space with the aim of trading their securities called the stock market, in which prices are set for their exchange, according to the so-called law of supply and demand, and this market consists of the primary market, which is the issuance market in which it is offered. All securities for the first time, and the second market, which is the one in which the securities that are issued in the primary market are traded.

The importance of securities

  • Financial and market value, and this value is subject to increase or decrease, depending on the situation of the issuing company, it can be high at the beginning of the day, and it collapses in the evening hours, and for this reason the financial bulletin is broadcast after the closing of the global financial market (the stock exchange).
  • Its ability to trade through commercial methods, there is a possibility to lease it, and that is by signing the owner on the back of the bond, or delivering it in the event that it is a bond for the bearer, and these methods are considered easier than the methods of civil trading.
  • The ability of these papers to pay and pay off the debts accumulated on its owner.

Types of securities

  • Shares, which is evidence that its holder has a part in the company that issued that stock.
  • Bonds, bonds are usually issued to be evidence of the debtor of the issuing company, which increases the return and income that the bondholder takes, and is divided into two types:
    • Cash bonds, which are issued against a cash amount provided by the owner of the bond.
    • In-kind bonds, which correspond to in-kind properties offered to the issuing company, such as land and buildings, and are divided according to the way they are issued to:
      • Nominal ads, which are issued in the name of their owner.
      • The bonds of their holders, which are issued without writing any names, will automatically be owned by whoever holds them.
      • Bonds by order, this type of bond can be leased, and the importance of liming is to follow the chain of signatures and owners of this bond.

Conditions of attractiveness and efficiency in the stock market

  • The greater the market and its depth, the more the number of companies listed on the market, the more deep it will be, and the greater the market value of shares traded, the greater the market will be.
  • Liquidity, which means the possibility of converting securities into money at the time the investor needs, and the larger the market, the greater the liquidity.
  • Transparency, i.e. providing all information about companies listed on the market, and ensuring that they are kept up-to-date.

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