securities bonds debts debentures?

Question

in mutual funds and ulips they are investing in securities debts bonds and debentures. what are the difference between them

Answer 1

Securities is the generic term for tradable, investable assets. The term can be used to refer to both stocks and bonds, as well as other investment structures.

Bonds are securitized debt issued by a borrowing organization. The organization agrees to pay interest to the bondholder and at the maturity of the bond to repay the principal amount. Bonds are considered safer than equity because of the promised interest payment and also the return of capital at maturity. In addition, if the company goes bankrupt, bondholders have the first claim on the bankrupt company's assets. Bonds can be secured, where they are backed by specific assets and cash flows or they can be unsecured, and backed by the general faith and credit of the issuing organization. Unsecured bonds are called debentures

Answer 2

A debenture is defined as a certificate of acceptance of loans which is given under the company's stamp and carries an undertaking that the debenture holder will get a fixed return (fixed on the basis of interest rates) and the principal amount whenever the debenture matures. In finance, a debenture is a long-term debt instrument used by governments and large companies to obtain funds. It is defined as "a debt secured only by the debtor’s earning power, not by a lien on any specific asset."[1] It is similar to a bond except the securitization conditions are different. A debenture is usually unsecured in the sense that there are no liens or pledges on specific assets. It is, however, secured by all properties not otherwise pledged. In the case of bankruptcy debenture holders are considered general creditors. The advantage of debentures to the issuer is they leave specific assets burden free, and thereby leave them open for subsequent financing.Debentures are generally freely transferrable by the debenture holder. Debenture holders have no voting rights and the interest given to them is a charge against profit.

Answer 3

Securities is investments in regular share market where there is high risk and high returns
Debts Bonds is investments in govt bonds and other bonds of limited companies where the risk is low and the returns are also low.
debentures - Investments where there is a assured return and even the risk factor is also to a certain extent only.