Equity Securities Flashcards
1
Q
The securities industry is fundamentally about two things:
A
- Raising money
2. Investing money
2
Q
Raising money
A
also called financing—refers to finding sources of money
3
Q
Selling partial ownership in the form of shares or stock is called
A
Equity Financing
4
Q
The purchased shares or stock are called
A
Equity Securities
5
Q
In accounting terms, “equity” means
A
what is left over after all debts have been paid
6
Q
The second way for a company to raise money is to issue debt securities
A
A debt security is sort of like a loan or an IOU. In exchange for money from an investor, the company (also called the issuer) agrees to pay the investor a specific amount of money in the future and also to pay the investor periodic interest along the way. Bonds are a common type of debt security.
