Final answer:
Securities refer to financial instruments that can be bought or sold in the financial markets. The two main types of investments that are considered securities are debt and equity. Debt securities represent a loan made to a company or government, while equity securities represent ownership in a company.
Step-by-step explanation:
In the world of investing, securities refer to financial instruments that can be bought or sold in the financial markets. These instruments represent ownership or debt in a company or government entity. The two main types of investments that are considered securities are debt and equity.
Debt securities are investments that represent a loan made by an individual or organization to a company or government. Examples of debt securities include bonds and Treasury bills. When you invest in a debt security, you are essentially lending money to the issuer in exchange for periodic interest payments and the return of the principal amount at maturity.
Equity securities represent ownership in a company. When you purchase shares of stock in a company, you become a partial owner of that company. As a shareholder, you have the right to vote on certain company matters and receive a share of the company's profits in the form of dividends. Stocks are the most common type of equity security.
Based on the above information, the correct answer to the question is a. both debt and equity.