Definition and characteristics of securities

1. Definition of securities

Securities refer to all kinds of legal documents that record and express certain rights. It is used to prove that the holder has the right to obtain due rights and interests according to the contents recorded in the certificate he holds. Generally speaking, securities refer to written documents used to prove or create rights, indicating that the holder of the securities or a third party has the right to obtain specific rights and interests of the securities or to prove that it has acted.

2. The face value of securities

There are four main par elements of securities: one is the holder, who owns the securities; Second, the subject matter of securities, that is, the specific content specified on the face of securities, indicates the specific object to which the holder's rights point; Third, the value of the subject matter, that is, the value of the subject matter stated in the securities; Fourth, the right, that is, the holder's right to hold securities.

3. Characteristics of securities

First, the property rights of securities. The property right of negotiable securities means that negotiable securities record the content of the obligee's property right, which represents a kind of property ownership. Having negotiable securities means enjoying the right to possess, use, benefit and dispose of the property. In modern economic society, property rights and securities are inseparable, and the two are integrated, and securities become the general form of property rights. Although the securities holder does not actually own the property, he can own the ownership or creditor's rights of the related property by holding the securities.

Second, the profitability of securities. The profitability of securities means that holding the securities itself can get some income, which is the return of investors' transfer of the right to use funds. Securities represent the ownership of a certain number of assets, and assets are a special kind of value, which will continue to move and increase in value in the social and economic operation, and eventually form a value higher than the original investment value. Since the ownership of such assets belongs to securities investors, investors also have the right to obtain the value-added income of these assets when holding securities, so the securities themselves are profitable. The income of securities is represented by interest income, dividend income and the price difference between buying and selling securities. The amount of income usually depends on the appreciation of assets and the supply and demand of the securities market.

Third, the liquidity of securities. Liquidity of securities, also known as liquidity, means that securities holders can flexibly transfer securities according to their own needs in exchange for cash. Liquidity is the vitality of securities. Liquidity not only enables securities holders to convert securities into cash at any time, but also enables holders to choose the types of securities they hold according to their own preferences. The circulation of securities is realized by acceptance, discount and transaction.

Fourth, securities risk. The risk of securities means that the holder of securities is faced with the possibility that the expected investment income cannot be realized, and may even lose the principal. This is caused by the uncertainty of the future economic situation. Under the existing social production conditions, some investors can predict the future economic development and changes, and some investors can't predict them. Therefore, it is difficult for investors to determine whether and how much income they can get from the securities they hold in the future, which makes holding securities risky.

Classification and function of securities

1. Securities classification

There are two concepts of securities: broad sense and narrow sense. Securities in a broad sense include commodity securities, currency securities and capital security.

Commodity securities are documents that prove that the holder has the ownership or use right of commodities. Obtaining such securities is equivalent to obtaining the ownership of goods, and the owner's ownership of the goods represented by such securities is protected by law. Commodity securities include bills of lading, waybills and warehouse receipts.

Monetary securities refer to securities that enable the holder or a third party to obtain the right to claim money. Currency securities mainly include two types: one is commercial securities, mainly including commercial bills and commercial promissory notes; The other is bank securities, mainly including bank drafts, cashier's checks and checks.

Capital security refers to the securities generated by financial investment or activities directly related to financial investment. Holders have certain rights to claim income, including stocks, bonds, fund securities and their derivatives such as financial futures and convertible securities.

Capital security is the main form of securities, and securities in a narrow sense refer to capital security. In daily life, people usually take a narrow sense.

Securities-short for securities and marketable securities in capital security.

Securities can be further divided into listed securities and unlisted securities. Listed securities, also known as listed securities, refer to the securities approved by the competent securities department, registered in the stock exchange, and qualified for public trading in the exchange. In order to protect the interests of investors, the stock exchange has certain requirements for the securities applying for listing. In order to be listed on the stock exchange, the stocks or bonds issued by the company must meet the listing conditions stipulated by the exchange and abide by other rules and regulations of the exchange. When the stocks or bonds issued by a listed company cannot meet the requirements of the stock exchange for securities listing, the ownership of the transaction will disqualify the company from securities listing. The listing of securities can expand the social influence of the issuing company, improve the company's reputation and reputation, and enable it to raise capital and expand its economic strength under more favorable conditions. For investors, buying securities is an investment behavior, because the listing of securities provides a continuous market and maintains the liquidity of securities. At the same time, listed companies must regularly publish their operating results and financial status, which is conducive to investors making correct decisions.

Unlisted securities, also known as unlisted securities, refer to securities that have not applied for listing or do not meet the listing conditions of stock exchanges. Unlisted securities are not allowed to be traded in stock exchanges, but they can be traded in other stock markets. Generally speaking, there are more kinds of unlisted securities than listed securities. Among the unlisted securities, some are large commercial banks and insurance companies with good reputation. In order to avoid paying fees and submitting financial statements to the stock exchange every year, they are reluctant to register and list on the stock exchange even if they meet the conditions stipulated by the stock exchange.

2. Functions of securities

Securities is the carrier of capital, which has the following two basic functions:

First of all, the fund-raising function is to raise funds for economic development. The scope of raising capital through securities is very wide, and all levels and aspects of social and economic activities can use securities to raise capital. For example, enterprises raise funds by issuing securities, and the state raises financial funds by issuing government bonds.

Second, the function of allocating capital is to allocate capital according to the requirements of maximizing profits through the issuance and trading of securities. Capital is a scarce resource, and how to allocate capital effectively is the fundamental purpose of economic operation. The issuance and trading of securities play a role in the spontaneous distribution of capital. By issuing securities, we can absorb the idle monetary capital in society and make it re-enter the reproduction process of the economic system and play its role. The trading of securities is induced by price, and the price depends on the value of securities. The value of securities depends on the actual use efficiency of the capital it represents. Therefore, the higher the efficiency of the use of capital, the more capital can be raised from the market, so that the flow of capital follows the principle of maximizing efficiency and finally realizes the optimal allocation of capital.