Securities are financial instruments that can be traded in markets. They fall into three broad categories: equity securities (stocks — ownership in a company), debt securities (bonds — loans to an entity), and derivative securities (options, futures — contracts whose value derives from an underlying asset).
Securities are regulated by government agencies: the SEC in the US, SEBI in India, FCA in the UK. These regulators ensure fair trading, prevent fraud, and protect investors. Companies must register securities and provide transparent financial disclosures before selling to the public. The global securities market is worth over $250 trillion.
The securities industry has evolved from physical stock certificates to fully electronic trading. In India, NSDL and CDSL hold all securities in dematerialized (demat) form. Settlement has compressed from T+5 days to T+1 in India (since 2023) and T+2 in the US. The shift to digital has made markets faster, cheaper, and accessible to hundreds of millions of retail investors.