Securities and security types

2012
Definition

 Financal instrument representing financal

value
 Represent a claim against the owner of
security who issued a security (issuer)
Important terms

 Issuer- recieve funds which needs for their bussiness

 Company
 Bank
 state
 Borrower-one, who issued security, has obligation to
the lender
 Lender-owner of the issued security, invest and
make money
Value of security

 Sold on public market and bought for market

value (rate)
 Rate depends on offers and demands of
securities
 Higher or lower than the nominal value
Classification

 By the form:
 Materialized
 Immobilized
 Dematerialized
• How it change ownership
 Beaer
 Security bearing the name of owner
Classification

 By the lenght of the held security

1. Capital market securities
 Long- term securities
 Credit securities
2. Money market
 Short- term securities
• By the issuer
• Under the law to which the securities are
estabileshed
Capital market securities

 S. with maturity longer than 1 year

 Equities- right on a certain amount of assets
of issuer- shares, participation list
 Credit securities- liability to the owner of the
issuer of the security
Stock

 Equity security representing share capital of

the company
 Determined by nominal values
 3 basic rights of owner:
 Participate in profits
 Participate on the company management
 Liquidation of assets
Unit trust

 Equity security –owner has right to

participate in the revenue fund
 Sum of property owned by all owners of units
 Open and close unit trust
Bonds

 Loan security – long- term commitment of

isseur to the owner of s.
 Owner of bond- right on interest rate and
repayment of the nominal value of security in
maturity date
 Bonds market- larger than stoc
Notes and Cheques

 Notes
 Belong to money market
 Confirm commitment to the borower againts the
creditor
 Cheques
 short-term s, money market
 Instrument of payment
 Written statement to bank to pay from private
account amount of money
Resources

 http://www.cennypapir.cz

http://giveto.psu.edu/s/1218/images/editor_d
ocuments/Media_and_Events/Publications/
Gift_Planning/publicly-traded-securities.pdf

 http://www.wisegeek.com/what-is-a-financial-
security.htm