Financial Securities Explained

Do you know what financial securities are?
They are financial instruments that represent money or value in different ways. For example, stocks give you a share of ownership in a company, while bonds let you lend money to a borrower and earn interest. Financial securities can be traded on the market and their prices can change depending on supply and demand. Financial securities are important for investors, businesses and governments as they help them raise funds, diversify risks and allocate resources efficiently.

A real life example of a government using securities to fundraise projects is the US Treasury issuing Treasury bonds (T-Bonds) with maturities of between 10 and 30 years. The US Treasury uses the proceeds from selling T-Bonds to finance public debt, fund federal programs, and support economic growth.