Categorisation of Securities

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Contents

Issuer

The entity issuing the security e.g. a government or corporate.

Currency

The currency the security is traded in. For example, bonds traded in the UK in currencies other than sterling are known as Eurobonds.

Ownership rights

i.e. whether they are shareholders.

Term to maturity

Degree of Liquidity

The ease at which they can be converted to cash e.g. current accounts are very liquid, pension funds are very illiquid because they cannot be cashed until retirement. Also, quantity can be important e.g. harder to offload larger amounts.

Income Payments

e.g. some pay monthly, semi-annually , annually or not at all.

Tax treatment

e.g. income tax, capital gains tax or tax-exempt.

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