Financial Instruments and Securities Regulation Quiz

Securities and Ownership

• A security is a financial instrument that holds monetary value and can be traded. Common examples include stocks, bonds, and options.
• A certificate of ownership represents legal proof of ownership in tangible or intangible assets, often associated with shares in a company or funds.

RA NO. 8799

• RA NO. 8799 is the Securities Regulation Code of the Philippines, establishing governance for securities trading and protecting investor rights.

Bonds

• A bond represents a fixed income investment in which an investor loans money to an entity (government or corporation) for a defined period at a fixed interest rate.

Asset-Backed Securities (ABS)

• Asset-backed securities are financial securities backed by a pool of assets, such as mortgages, car loans, or credit card debt, providing a way for institutions to obtain funding while offering investors returns based on the cash flows from the underlying assets.

Fungibility in Securities

• The term 'fungible' refers to goods or assets that are interchangeable because each unit is equivalent in value and function. In relation to securities, it means that shares or bonds can be exchanged or traded without any loss of value.

Exclusions from Securities

• Certain financial instruments, such as personal property or collectibles, are not considered securities due to their unique nature and lack of tradeability within established financial markets.