Scroll Top

search-icon
    drop-arrow

    Security

    Introduction

    Security is a financial instrument denoting various financial assets. It is denoted by fixed face value and held in the demat form.

    Understanding Security

    Securities carry a monetary value. The broad categories of securities include equity, debt and hybrid securities. Corporations raise money from through public and private means from the sale of securities. Equity represents an ownership interest in a public enterprise.

    A public issue can comprise of equity issue through Initial Public Offering (IPO), further issue of capital or issue of any other securities.

    Factors to Consider

    1. Equity securities do not carry a fixed rate of return. Equity shareholders are, however, entitled to a dividend as and when paid by the company. Equity shareholders can benefit from capital gains on the sale of equity shares.
    2. Equity shares also carry voting rights. Equity shareholders, being owners of the corporation, are entitled to vote based on the number of equity shares held by them.
    3. In the case of winding up of the corporation or closure of the company due to bankruptcy, etc., the equity shareholders will receive only the residual amount after all the payment of all the creditor’s dues. The equity holders may also be offered payment in kind.
    4. Debt securities, such as debentures or bonds, and hybrid securities such as preference shares carry a fixed rate of return.
    5. Debt securities are issued in return to monies borrowed. The securities are for a fixed tenure; they carry an interest rate and a maturity or renewal date.
    6. Debt securities may be secured (using collateral) or unsecured
    7. Hybrid securities combine features of equity and debt.
    8. Most types of securities are listed and traded on the stock exchange.
    9. Debt securities and hybrid securities are redeemed at par. However, holders of equity securities are paid at the end after the payment of all creditors.
    10. Example of hybrid securities includes equity warrants (equity options given to shareholders to purchase stock), convertible bonds (bonds that can be converted into shares).
    Index

    Clear offers taxation & financial solutions to individuals, businesses, organizations & chartered accountants in India. Clear serves 1.5+ Million happy customers, 20000+ CAs & tax experts & 10000+ businesses across India.

    Efiling Income Tax Returns(ITR) is made easy with Clear platform. Just upload your form 16, claim your deductions and get your acknowledgment number online. You can efile income tax return on your income from salary, house property, capital gains, business & profession and income from other sources. Further you can also file TDS returns, generate Form-16, use our Tax Calculator software, claim HRA, check refund status and generate rent receipts for Income Tax Filing.

    CAs, experts and businesses can get GST ready with Clear GST software & certification course. Our GST Software helps CAs, tax experts & business to manage returns & invoices in an easy manner. Our Goods & Services Tax course includes tutorial videos, guides and expert assistance to help you in mastering Goods and Services Tax. Clear can also help you in getting your business registered for Goods & Services Tax Law.

    Save taxes with Clear by investing in tax saving mutual funds (ELSS) online. Our experts suggest the best funds and you can get high returns by investing directly or through SIP. Download Black by ClearTax App to file returns from your mobile phone.

    Cleartax is a product by Defmacro Software Pvt. Ltd.

    Company PolicyTerms of use

    ISO

    ISO 27001

    Data Center

    SSL

    SSL Certified Site

    128-bit encryption