About This Chapter
Debt Securities - Chapter Summary
There is a lot of information for you to review about debt securities in this chapter. You'll start with the definition, and further your knowledge with specific examples. As you continue through the lessons you will also cover the structure, risks, rewards, and call provisions of debt securities. By the time you reach the end of the chapter you will also be able to:
- Discuss the advantages and disadvantages of commercial paper
- Analyze the pros and cons of certificates of deposit
- Define a Eurodollar Bond and explain its advantages and disadvantages
- Discuss the pros and cons of variable-rate preferred debt securities
- Explain the characteristics of structured products
- List the types and characteristics of non-U.S. debt securities
- Explain types of debt security yields, including examples
- Discuss Moody's vs. Standard & Poor's bond ratings
As you proceed through each lesson, you will notice that our professional instructors have emphasized certain key terms. By focusing your attention on these terms you are likely to progress more rapidly toward a thorough understanding of this topic. You can self-monitor your comprehension with our lesson-end quizzes and by tracking your progress on your Dashboard.
1. Debt Securities: Definition & Examples
While they share similar attributes, debt securities vary by the type of institution that creates them. In this lesson, we'll review how institutions use debt securities to finance operational activities.
2. Commercial Paper: Definition, Advantages & Disadvantages
A great way for companies with high credit ratings to raise short term cash for operating purposes is through commercial paper. Most large public companies issue commercial paper.
3. Certificate of Deposit: Definition, Advantages & Disadvantages
One of the advantages of being financially wise and having a savings account or funds to invest is that you can make your money work for you by earning interest. In this lesson we'll learn about one investment - a certificate of deposit.
4. Eurodollar Bond: Definition, Advantages & Disadvantages
In this lesson, you will be introduced to Eurodollar bonds, their characteristics, issuing entities, currency denominations, etc. The lesson will also talk about the advantages and disadvantages of Eurodollar bonds to different entities.
5. Variable-Rate Preferred Debt Securities: Definition, Pros & Cons
This lesson deals with variable-rate preferred debt securities. We will learn about inflation based, interest rate linked and mixed rate variable-rate preferred debt securities.
6. Debt Securities: Structure, Risks, Rewards & Call Provisions
In this lesson you will learn about the common structure of debt securities, sources of risks and rewards, call provisions and their effects on security issuers and investors.
7. Structured Products: Definition & Characteristics
This lesson deals with structured products, their composition, and their characteristics. Learn about equity-linked securities and exchange-traded notes (ETNs) and their characteristics.
8. Non-U.S. Debt Securities: Types & Characteristics
This lesson deals with debt securities issued or traded outside the US. Learn how to differentiate among international bonds, such as Eurobonds, foreign bonds, global bonds, and sovereign bonds.
9. Debt Security Yields: Types & Examples
This lesson deals with different types of bond yields. Learn to understand the difference between the types of yields, the relationship between them and their effect on the price of bonds.
10. Moody's vs. Standard & Poor's Bond Ratings
Moody's and Standard & Poor's are bond rating organizations that evaluate the credit worthiness of individual corporate and government bonds. This lesson will familiarize you with the basics of their bond rating systems.
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Other chapters within the Series 7 Exam: Study Guide & Practice course
- Advertising & Public Communication in the Securities Industry
- The New Issues Market
- New Issue Regulations in the Securities Industry
- Brokerage Account Types & Restrictions
- Retirement Plans & Tax-Advantaged Accounts
- Handling Customer Investment Information & Discretionary Accounts
- Obtaining Supervisory Approvals for Investment Accounts
- Analyzing Customer Investment Profiles
- Analyzing Customer Financial Statements
- Understanding Equity Securities
- Tax Treatment of Equity Securities Transactions
- Packaged Investment Products
- Variable Life Insurance & Annuities
- Real Estate Investment Trusts
- Direct Participation Programs
- Understanding Options in Investing
- Investing in Corporate Bonds
- Municipal Securities
- Municipal Securities Analysis & Regulations
- Registered Hedge Funds
- Asset-Backed Securities
- U.S. Government Agency Securities
- Investment Product Disclosures
- Customer Updates & Record Retention
- Customer Transactions & Confirmations
- Transactional Delivery Obligations & Settlement Procedures
- Investment Disputes & Customer Complaints
- Addressing Margin Issues