What is the Difference Between Shares and Securities?
🆚 Go to Comparative Table 🆚The difference between shares and securities lies in their definitions and the scope of their meanings. Here are the key distinctions:
- Shares: Shares refer to the individual units of ownership in a single company. They represent a portion of a company's stock and are traded on stock exchanges. When an investor buys shares, they become a shareholder and receive a stock certificate as proof of ownership, which indicates the number of shares held. Shares can only be bought and sold in whole numbers.
- Securities: Securities are financial instruments that represent a claim on the issuer's assets or income. They can be exchanged among investors in the forms of debt, equity, or an agreement for a specific return value for the principal. Securities include not only shares but also other financial instruments such as bonds, debentures, and derivatives.
In summary, shares are a type of equity security that represents ownership in a corporation, while securities encompass a broader range of financial instruments, including shares, debt instruments, and other agreements for specific returns.
On this pageWhat is the Difference Between Shares and Securities? Comparative Table: Shares vs Securities
Comparative Table: Shares vs Securities
The difference between shares and securities can be understood by examining their definitions and characteristics:
| Shares | Securities |
|---|---|
| Shares represent ownership in a company and are a type of security. They give the shareholder certain rights, such as the right to receive dividends and the right to vote on company matters. | Securities are financial instruments that represent a financial claim or ownership interest in a company or other entity. They can be divided into two main categories: debt securities and equity securities. Debt securities, such as bonds, represent loans to entities, while equity securities represent ownership in a company or project, such as shares or units. |
In summary, shares are a specific type of security that represents ownership in a company, while securities are a broader term encompassing various financial instruments, including shares and other types of investments.
Read more:
- Securities vs Stocks
- Shares vs Stocks
- Shares vs Bonds
- Equity vs Shares
- Debentures vs Shares
- Shares vs Loan
- Shareholder vs Investor
- Equity vs Security
- Equity vs Debt Securities
- Stocks vs Bonds
- Shareholders vs Stakeholders
- Stock Exchange vs Stock Market
- Capital Market vs Stock Market
- Stocks vs Mutual Funds
- Share Certificate vs Share Warrant
- Right Shares vs Bonus Shares
- Allotment vs Issue of Shares
- Equity Shares vs Preference Shares
- Transfer vs Transmission of Shares