What are the two types of corporate securities?
Corporate securities represent tradable financial instruments issued by companies to raise capital from public and private investors, fundamentally divided into two primary asset classes. The first category is equity securities, which represent an ownership interest in the issuing corporation, most commonly in the form of common stock or preferred stock, granting shareholders claims on corporate earnings and voting rights. The second category is debt securities, which represent borrowed capital that the issuing company is legally obligated to repay with periodic interest, typically manifested through corporate bonds, debentures, and commercial paper. Together, these two fundamental financial instruments form the bedrock of corporate finance, capital structuring, and global securities exchange trading.
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