Investment quality of securities. The concept of the securities market. The main types of securities.

Today the popularity of securities as an instrumentinvestment is constantly growing. At the same time, they are increasingly acquired by small investors who do not understand the economic essence of such a financial instrument and do not know how to evaluate the investment quality of securities.

Securities can be described as a type of financial obligation that
confirms the owner's right to receive profit or possession of a part of the property of the issuer.

Before you buy the debt assets of an enterprise, it is important to assess the investment quality of securities. The most important evaluated characteristics are:

- liquidity - the ability of financial instruments to be transformed quickly and without significant losses by selling in cash;

- profitableness is an opportunity of a gain of the capital in case of purchase and the subsequent sale of a security;

- investment risk - the possibility of partial or complete loss of funds invested in any financial instrument;

- Reversibility is the ability of a paper to be sold and bought on the market.

All these characteristics affect the present and future value of the asset.

We can say that the investment qualities of valuablesecurities depend on the type of financial instrument. The characteristics of the paper can be influenced by: financial well-being of the issuer, reliability and security of investments, as well as

possibility of conversion.

In general, the stock market is a set of relationships that are interrelated with the issuance and circulation of financial instruments. The classification of the securities market is determined by the practical value:

- for the purposes of the functioning of the market,primary and secondary. The first is a relationship about the initial placement of securities between investors, the second - the subsequent trade of already placed instruments;

- Organizational and spontaneous markets are distinguished according to the degree of organization;

- depending on the type of circulating stock valuables - stock markets, bonds and the like;

- in the category of financial instruments - the main markets, as well as derivative securities.

Basic securities are financial instruments that are based on property law. The most common of them are stocks and bonds.

The action is a financial instrument that confirms the right

investor for a certain share of propertyjoint stock company, part of its profits, as well as the opportunity to participate in the management of the company. The share is equity paper, that is, the money received upon their issue, belong to the company and can not be returned.

The bond refers to debt securities, it certifies a loan agreement between its issuer and the holder.

At the heart of derivative financial instrumentsthere are price assets, which include: the prices of goods or basic securities, the credit or foreign exchange market. Such assets certify the right or duty of the holder to purchase or sell on a specified basis (price, quantity and time) the underlying asset. This group includes bills of exchange, options, bills of lading and many other instruments.

A promissory note is an unconditional obligation of the person who issued it, to pay the holder a certain amount in the stipulated terms.

The option provides the right, and not the obligation to acquire an asset at a fixed cost.

Bills of lading represent the unconditional obligation of the sea carrier to deliver the goods in accordance with the terms of the contract.

The variety of securities leads to the fact thatThe investor in the process of choosing investment tools faces a wide choice. In order not to be mistaken, choosing the way of investing, it is necessary to carefully study the investment qualities of securities.

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