Securities can be classified as either debt securities, such as bonds, or equity securities, such as stocks. Debt securities refer to financial instruments that represent money borrowed and include government bonds, corporate bonds, certificates of deposit, and collateralized debt obligations. Equity securities provide dividend income but can fluctuate in value with economic changes and the company's fortunes. Derivatives derive their value from an underlying asset, index, or interest rate, and are used for hedging risks or speculating; common derivatives include forwards, futures, options, and swaps.

1. Udith Uday

2. Security
 A security, in a financial context, is a certificate or
other financial instrument that has monetary value
and can be traded. Securities are generally classified
as either equity securities, such as stocks and
debt securities, such as bonds and debentures.

3. Contd..
Securities are generally categorized into;
 debt securities (e.g., banknotes, bonds and debentures
 equity securities (e.g., common stocks)
 derivatives (e.g., forwards, futures, options and swaps).

4. Debt securities
 Debt security refers to a debt instrument, such as
a government bond, corporate bond,certificate of deposit
(CD), municipal bond or preferred stock, that can be
bought or sold between two parties and has basic terms
defined, such as notional amount (amount borrowed),
interest rate, and maturity and renewal date. It also
includes collateralized securities, such as collateralized
debt obligations (CDOs), collateralized mortgage
obligations (CMOs), mortgage-backed securities issued by
the Government National Mortgage Association (GNMAs)
and zero-coupon securities.

5. Equity securities
 Equity securities usually provide steady income as
dividends but may fluctuate significantly in their
market value with the ups and downs in the economic
cycle and the fortunes of the issuing firm.
2. Right to subscribe for, or convert another security
(such as a bond) into, the common stock (ordinary
shares) of a firm.

6. Derivatives
 a derivative is a contract that derives its value from the performance
of an underlying entity. This underlying entity can be an asset, index,
or interest rate, and is often simply called the "underlying.[ Derivatives
can be used for a number of purposes, including insuring against price
movements (hedging), increasing exposure to price movements for
speculation or getting access to otherwise hard-to-trade assets or
markets.Some of the more common derivatives
include forwards, futures, options, swaps, and variations of these such
as synthetic collateralized debt obligations and credit default swaps.
Most derivatives are traded over-the-counter (off-exchange) or on an
exchange such as the Bombay Stock Exchange, while most insurance
contracts have developed into a separate industry. Derivatives are one
of the three main categories of financial instruments, the other two
being stocks (i.e., equities or shares) and debt (i.e., bonds and
mortgages).