Paying interest in a debt security
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grace
Apprentice
Joined: 01 Sep 2007
Posts: 1
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 Posted: 08/30/08 - 05:13 Post subject: |
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| Hello there everyone. My name is Alex and I would appreciate if you could tell me something about debt securities. What kind of securities is that and is it worth investing in them. What about paying interest in a debt security? How does it work? Thank you in advance for your posts. |
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paxton
Apprentice
Joined: 06 Feb 2008
Posts: 1
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| Posted: 09/14/08 - 01:28 Post subject: |
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| Hello to you too Alex. Well, here’s the thing. Debt security is a financial instrument which issuers use to collect capital. So, it is loan in form of a financial instrument. Debt securities are bonds, deposits, commercial papers and debentures. They are less risky so it’s definitely worth investing in them. When it comes to interest, it is usually paid periodically. |
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conrado
Apprentice
Joined: 06 Jun 2008
Posts: 1
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| Posted: 09/28/08 - 21:44 Post subject: |
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| Hello Alex. Since issuers of debt securities collect money form the buyers and then pay them back with some interest, you can say that it is some kind of loan. Now, most common type of debt securities is bonds. Bonds are pretty good as an investment choice, because they are less risky and they can still provide some nice income. I would suggest you to invest in government or municipal bonds, if you are interested, off course. That would be all from me. Bye! |
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