What are securities when talking about the stock market...?

Question

What are securities when talking about the stock market...?

Answer 1

When Charles Dow (of Dow Jones fame) first started his financial reporting, it was corporate bonds that were the big way to invest in companies. He sexed up common stocks as a place to invest (or speculatively trade), so his "averages" became a series of benchmarks (not just industrials) to take a tad bit of the risk out for those interested. Some however want some sense of equity yet with more guarantees concerning dividend stability, so there are these quasi bonds and stocks that are a class of equity called preferred shares.

These are securities. What is secure about the bonds is that they get paid from the company's value, if it folded, first. The preferred stocks get paid next of what is left after the bonds and other such common debts are cleared. If there is anything left when liquidating a company, that is divided among common stockholders. There are a wide range of possible variations and some companies have several bonds and classes of stocks, each in their relative pecking order for liquidation.

That is what "securities" are.

Answer 2

Securities are mainly identified as a company selling part ownership to people to raise money to continue its operations. When you purchase securities, you are giving the company money with the hope and expectation of getting it back some time in the future. When you purchase securities, you are taking a risk that the company will go out of business and you will not get your money back. But if the company grows, your value of the securities or stocks, should increase and the value of your securities will be worth more than the money you gave them in the first place. Securities come in different forms and are usually traded on stock exchanges, the New York stock exchange being the most famous and well-known.

Answer 3

"Securities" are stocks, bonds and other investment vehicles that are traded on the "secondary" market, which simply means traded between interested parties outside the original issuer.  For example, Ford sold stocks in their company, I bought some, and would now like to sell them to you!