1.Fixed income securities. 2.Equity shares 3.Mutual fund units 4.

Derivative securities

There are two types of Fixed income securities: 1.Bonds 2.Preference shares

1.Fixed income securitiesIncome are fixed in nature. Bonds and preference share are the two fixed income securities. The issuer pays interest and the principal amount on these securities. For Bonds issuing company agrees to pay interest at fixed rate and at specified intervals of time. For preference shares issuer specifies to pay certain % of dividend that are also at a fixed rate.

It is the debt securities issued by the government whereas the term debenture is associated with the issuances of companies. It is an acknowledgement of debt means issuer has a obligation to pay interest and repay the principal amount at time of maturity. Bond having fixed maturity period.

1.Government bonds/Treasury bondsDescries as dated securities. There is no default risk Bank and FIs are the major investors in the government bond because of SLR requirements. 2.Municipal bonds Bond issued by local authorities Interest income are exempt from income Tax.

3.Corporate bonds1. Entail a risk of default by the issuing companies 2. Interest on bonds are higher than the government bonds. 3. As there a risk element ,an issuing firms are required to obtain credit rating for the instrument 4. Rating symbols the risk level.

Fixed income securities issued by the companies Hybrid security (feature of debt and equities) Fixed rate of dividend. Preferential right for the preference shareholders over equity shareholder.

Equity shares provide ownership to the holder. They have voting rights and are entitled to select BOD. Holder receive dividend declare by BOD. The dividend amount varies and there is no certainty that dividend will be declare Return are uncertain that shows its risky nature. Share traded in Stock exchange ,helps to find market capitalisation.

Collect the capital from the public by issuing units of mutual fund schemes. Investors pool together their money to buy stocks, bonds, or any other investments. Derivatives The securities derived their value from underlying assets such as stock, commodities, currencies etc.

3 Is of capital market are:a)Issuers- There are two types of Issuers Namely companies and government b)Intermediaries c)Investors SEBI has listed the following institutions as intermediaries in its handbook of statistics on the Indian securities Market 2008.

1. Stock

exchange 2. Brokers 3. Sub-brokers 4. Custodians 5. Depositories, depository participants 6. Merchant bankers 7. Banker to the issue 8. Underwriter 9. Registrar to issue

10.Portfolio Managers 11.Mutual funds 12.FIIs 13.Debentures trustees 14.Credit rating agencies 15.Collective investment schemes 16.Venture capital funds

Primary MARKET Secondary Market

Duties of registrar to the issuea) Receiving the share application. b) Suggesting the basis of allotment. c) Dispatching the shared certificate. d) Keeping the issue record.

3.Underwriter They give assurance to the insurer agencies to sell. 4.Bankers to the issue:a) Collection of application money along with application form. b) Bankers charge commission for their services. c) To create investment awareness collecting branches are designated in different town/cities.

5.Advertising agents-All sorts of promotional role and fulfillment of tentative target. 6.Financial institutions 7.Government and statutory parties:SEBI RBI Registrar of companies Relevant stock exchange Industrial licensing authority Pollution control board