What are government securities?
Any debt instruments that are issued by a sovereign government are considered government securities. Basically, the government issues these debt securities to fund operations of the government and provide guaranteed returns to individuals that hold the securities. Examples include:
Government securities are considered risk-free as the government guarantees payment, which means there is no default risk. Additionally, the interest rate is typically guaranteed.
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What are examples of debt securities?
A debt security is any security that is representing a creditor relationship with an outside entity. Examples of debt securities include corporate bonds, redeemable preferred stock, commercial paper, convertible debt, and government securities.
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What is convertible debt?
Convertible debt is a type of debt security that can be converted into a predetermined amount of the underlying company’s equity at certain times through the life of the debt security. The convertible debt would have a stated conversion rate like the debt would convert into 10 shares of common stock. However, until the debt...
What are examples of debt securities?
A debt security is any security that is representing a creditor relationship with an outside entity. Examples of debt securities include corporate bonds, redeemable preferred stock, commercial paper, convertible debt, and government securities.
What is convertible debt?
Convertible debt is a type of debt security that can be converted into a predetermined amount of the underlying company’s equity at certain times through the life of the debt security. The convertible debt would have a stated conversion rate like the debt would convert into 10 shares of common stock. However, until the debt...
