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What are securities? Options
Ebenezer Son
Posted: Saturday, June 22, 2019 12:11:00 PM
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Hi everyone,
Have been reading about a particular business area and came across the term "securities" but had hard time grasping its meaning, pls do me a favour by explaining it to me. Pls I'm green and humbly ask to be explained to like a six year old.
Many thanks.
NKM
Posted: Saturday, June 22, 2019 1:44:23 PM

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It is very common to use the word "securities" to mean "stocks and bonds".

Here's a dictionary definition (one of several) of "security":
6. A financial instrument, such as a stock or bond, representing rights of ownership or creditorship and often traded in secondary markets.

(Link)

taurine
Posted: Saturday, June 22, 2019 4:03:10 PM

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Like six years old? Hm...

Money. But not like the one you go to buy a chocolate and pay. You cannot pay with securities in the shop. There are people who can exchange securities for 'real' money if you give them your securities.
Securities are safely kept by trusted people. Sometimes, the longer you keep those securities and do not exchange them for banknotes, you can get more than the value on a piece of paper which says how much worth they are.
Because you are six years old, I, your father, must go with you to those people who keep your securities to exchange them for money if you need to buy a chocolate.
But, as long as I am with you, you do not need to pay for chocolate. I have one for you. Lindt chocolate.
Ebenezer Son
Posted: Saturday, June 22, 2019 4:33:10 PM
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Thank you very much gentle people.
So in this regard securities are money, right? So, is money paid to insurance companies so that they protect you is deemed security? Can expantiate. Still six years old
taurine
Posted: Saturday, June 22, 2019 4:59:55 PM

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Yes, you are right. In this regard securities are money.
If money is paid to insurance company then the story is a little different. Money paid to insurance company is paid to insure. This means, to give you in the future money if something goes wrong. This what is insured against something happening wrong can give you a hope for making good. It is basic explanation that in the event if anything what is protected by the insurance goes wrong, you can get money to stop worrying about what bad happened. In this regard you are right saying that money paid to insurance companies protect you. And this is deemed security, too.
So, you can now understand that, securities have more than one simple explanation. However, what is a common feature for these two explanations is that, securities are money. Money can give you security. And, in the case of insurance companies, protection from bad things happening, even by chance.
Adyl Mouhei
Posted: Sunday, June 23, 2019 5:01:49 AM

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taurine wrote:
Like six years old? Hm...

Money. But not like the one you go to buy a chocolate and pay. You cannot pay with securities in the shop. There are people who can exchange securities for 'real' money if you give them your securities.
Securities are safely kept by trusted people. Sometimes, the longer you keep those securities and do not exchange them for banknotes, you can get more than the value on a piece of paper which says how much worth they are.
Because you are six years old, I, your father, must go with you to those people who keep your securities to exchange them for money if you need to buy a chocolate.
But, as long as I am with you, you do not need to pay for chocolate. I have one for you. Lindt chocolate.
Adyl Mouhei
Posted: Sunday, June 23, 2019 5:04:25 AM

Rank: Advanced Member

Joined: 5/1/2017
Posts: 3,031
Neurons: 541,666
Location: Casablanca, Grand Casablanca, Morocco
Thank you. Good clarification.
oance
Posted: Monday, October 14, 2019 2:53:10 AM

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Location: New York, Florida, United States
When it come to securities that means features or market which offer you additional way to secure your money with some risk
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