What are shares (stocks) and bonds collectively called?

• A. Securities
• B. Bank Debt
• C. Accounts Payable
• D. Fixed Assets or Long-Term Assets

Answer: (A)

Securities are tradable financial instruments that represent claims on capital or income. Shares (stocks) and bonds fit this category because both are issued to raise capital and are negotiable in financial markets. Stocks give you ownership in a company and a claim to dividends and potential price appreciation, while bonds are debt securities where the issuer promises to pay interest and repay the principal. Both can be bought, sold, and priced in markets, making them part of the broad umbrella term “securities.” Other terms like bank debt describe loans from banks, accounts payable are short-term obligations to suppliers, and fixed assets are long-term tangible assets used in operations, none of which encompass both stocks and bonds as a common category.