1.

Long-term debt securities issued by the Government of India or any of

the State Government’s or undertakings owned by them or by
development financial institutions are called as bonds. Instruments
issued by other entities are called debentures. The difference between
the two is actually a function of where they are registered and pay
stamp duty and how they trade.

Debenture stamp duty is a state subject and the duty varies from state to state.
There are two kinds of stamp duties levied on debentures viz issuance and transfer.
Issuance stamp duty is paid in the state where the principal mortgage deed is
registered. Over the years, issuance stamp duties have been coming down. Stamp
duty on transfer is paid to the state in which the registered office of the company is
located. Transfer stamp duty remains high in many states and is probably the
biggest deterrent for trading in debentures in physical segment, resulting in lack of
liquidity.
On issuance, stamp duty is linked to mortgage creation, wherever applicable while
on transfer, it is levied in accordance with the laws of the state in which the
registered office of the company in question is located. A debenture transfer, has
to be effected through a transfer form prescribed for under Companies Act.
Issuance of stamp duty on bonds is under Indian Stamp Act 1899 (Central Act). A
bond is transferable by endorsement and delive without payment of any transfer
stamp duty.

2. A share or stock is also known as an equity share as well. The equity

share basically represents ownership in the company. When a company
needs capital or money to operate, it generates the required funds by
selling ownership in the company. This means that the company issues
equity shares for a price and these shares represent ownership in the
company for the one who purchases the shares. These shares are an
ownership in the company and give the owner the right to have a share in
the profits of the firm.

3. In finance and economics, divestment or divestiture is the reduction of some

kind of asset for either financial or ethical objectives or sale of an existing
business by a firm. A divestment is the opposite of an investment.

Firms may have several motives for divestitures:

First, a firm may divest (sell) businesses that are not part of its core operations so that it
can focus on what it does best. For example, Eastman Kodak, Ford Motor Company, and
many other firms have sold various businesses that were not closely related to their core
businesses.
A second motive for divestitures is to obtain funds. Divestitures generate funds for the
firm because it is selling one of its businesses in exchange for cash. For example, CSX
Corporation made divestitures to focus on its core railroad business and also to obtain
funds so that it could pay off some of its existing debt.

A third motive for divesting is that a firm's "break-up" value is sometimes believed to be
greater than the value of the firm as a whole. In other words, the sum of a firm's
individual asset liquidation values exceeds the market value of the firm's combined
assets. This encourages firms to sell off what would be worth more when liquidated than
when retained.

A fourth motive to divest a part of a firm may be to create stability. Philips, for example,
divested its chip division called NXP because the chip market was so volatile and
unpredictable that NXP was responsible for the majority of Philips's stock fluctuations
while it represented only a very small part of Philips NV.

A fifth motive for firms to divest a part of the company is that a division is
underperforming or even failing.

4. A market that exists between companies and financial institutions that is

used to raise equity capital for the companies is called an Equity Capital
Market. Some activities that companies operate in the equity capital
markets include: overall marketing, distribution and allocation of new
issues; initial public offerings, special warrants, and private
placements. Along with stocks, the equity capital markets deal with
derivative instruments such as futures, options and swaps.

The equity capital market is an important part of the capital market. In this market,
companies and financial institutions raise funds and provide equities using the
shares of their own businesses. Investors invest in the company by purchasing the
shares or equities.

Company stocks are the prime financial instrument of the equity capital market.
This instrument is provided and maintained by the companies or the financial
institutions themselves.

The equity capital market and the debt capital market together form the
capital market. The primary difference between the equity capital and debt
capital markets is the amount of risk and return related to them. The equity
capital market is known for its huge returns and its high risks. On the other
hand, the debt capital market is far more secure than the equity market but
the returns are low.
5. A leveraged buyout (or LBO, or highly-leveraged transaction (HLT), or
"bootstrap" transaction) occurs when a financial sponsor acquires a
controlling interest in a company's equity and where a significant
percentage of the purchase price is financed through leverage (borrowing).

Leveraged buyouts involve financial sponsors or private equity firms

making large acquisitions without committing all the capital required for the
acquisition. To do this, a financial sponsor will raise acquisition debt which is
ultimately secured upon the acquisition target and also looks to the cash flows
of the acquisition target to make interest and principal payments.

6. A mutual fund is a professionally managed type of collective investment

scheme that pools money from many investors and invests it in stocks,
bonds, short-term money market instruments, and/or other securities.[1] The
mutual fund will have a fund manager that trades the pooled money on a
regular basis. The net proceeds or losses are then typically distributed to
the investors annually.

7. A broker is a party that mediates between a buyer and a seller. A broker

who also acts as a seller or as a buyer becomes a principal party to the deal.
Distinguish agent: one who acts on behalf of a principal. A "brokerage" or
a "brokerage firm" is a business that acts as a broker. A brokerage firm is a
business that specializes in trading stocks.[1] A sales person working for a
securities or commodity brokerage firm is popularly (but incorrectly)
called a "broker." A broker in that context is, strictly speaking, an
exchange member who is actually executing the purchase or sales order in
the 'pit', on the exchange, as a service to the client of the firm for which
that salesman works.

8. Demat refers to a dematerialised account. Just as you have to open an

account with a bank if you want to save your money, make check
payments, etc., you need to open a demat account if you want to buy or sell
stocks. In a demat account shares and securities are held in electronic form
instead of cash. Demat Account is given to the investor while registering
with a broker or a sub broker. A demat account has a corresponding
account number which is used for all transactions.
The purpose of the demat account is to keep the shares safe are bought in the
Exchange (BSE or NSE). In earlier days before the demat accounts, investors were
given relevant documents and certificates for the shares they bought.

9. Savings accounts are accounts maintained by retail financial institutions

that pay interest but can not be used directly as money ( for example, by
writing a cheque). These accounts let customers set aside a portion of their
liquid assets while earning a monetary return.

Savings accounts are offered by commercial banks, savings and loan associations,
credit unions, building societies and mutual savings banks.

Obtaining funds held in a savings account may not be as convenient as from a

demand account. For example, one may need to visit an ATM or bank branch,
instead of writing a cheque or using a debit card. However, this transference is
easy enough that savings accounts are often termed "near money".