A financial market allows people to trade securities like stocks, bonds, and precious metals at low costs. A major platform for trading short-term financial instruments is the money market, where assets like treasury bills and commercial paper are exchanged. There are several types of equity accounts that make up total shareholders' equity, including common stock, preferred stock, and retained earnings. Common stock represents shareholder investment and ownership, while preferred stock has a guaranteed dividend but no voting rights. Debt securities are financial instruments that borrow money to be repaid at a future date with interest, such as bonds, bills, and notes. Derivatives are contracts between parties whose value is based on underlying assets like securities, commodities, or indexes. Common

2. a
A Security in a Financial Context ,is a Certificate or
other Financial Instrument that has a Monetary
Value and can be Traded. Security are generally
Classified as either Securities such as stock and debt
securities such as Bond and Debentures

3. A financial market is a market in
which people
trade financial securities and
derivatives at low transaction costs.
Some of the securities include
stocks and bonds, and precious
metals.

5. A major platform in financial market where securities and financial
instruments with short-term maturities are traded is called the
money market. Financial assets like treasury bills, certificates of
deposits, commercial paper and bankers' acceptance are some of
the short-term debt securities traded in the money market.

6. There are several types of equity accounts that combine to make up total shareholders’
equity. These accounts include: common stock, preferred stock
1.Common Stock -Common stock represents the owners’ or shareholder’s investment in the business as a
capital contribution. This account represents the shares that entitle the shareowners to vote and their residual
claim on the company’s assets. The value of common stock is equal to the par value of the shares times the
number of shares outstanding. For example, 1 million shares with $1 of par value would result in $1 million of
common share capital on the balance sheet
2.Preffered Stock- Preferred stock is quite similar to common stock. The preferred stock is a type of share that
often has no voting rights, but is guaranteed a cumulative dividend. If the dividend is not paid in one year, then
it will accumulate until paid off. Example: A preferred share of a company is entitled to $5 in cumulative
dividends in a year. The company has declared a dividend this year but has not paid dividends for the past two
years. The shareholder will receive $15 ($5/year x 3 years) in dividends this year.

7. Debt Securities
• A debt security refers to money borrowed that must be repaid that has a
fixed amount, a maturity date(s), and usually a specific rate of interest.
• Some debt securities are discounted in the original purchase price.
Examples of debt securities are treasury bills, bonds and commercial
paper. The borrower pays interest for the use of the money and pays the
principal amount on a specified date.
• A debt security refers to money borrowed that must be repaid that has a fixed
amount, a maturity date(s), and usually a specific rate of interest.
• Some debt securities are discounted in the original purchase price. Examples of debt
securities are treasury bills, bonds and commercial paper. The borrower pays interest
for the use of the money and pays the principal amount on a specified date.
• Types of Debt Securities
• Corporate Bonds,
• Municipal Bonds
• Government Bonds
• Treasury Bills , Notes & Bonds
• Commercial Paper
• Debentures

8. A derivative is a contract between two or more parties
whose value is based on an agreed-upon
underlying financial asset (like a security) or set of assets
(like an index). Common underlying instruments include
bonds, commodities, currencies, interest rates, market
indexes, and stocks.
Types of Derivative Securities
1.Future
2.Forwards
3.Options
4.Swaps

9. Prepared By:- Manish Kumar