Securities - from a financial aspect - are promises to pay on a future date. In this sense (but not legally), derivatives like forwards& futures, options, and swaps, are securities.
Securities have two forms: documents and dematerialised securities. The latter consists of a large set of data, containing all legal criteria of a security. It is created, recorded, and transmitted electronically, as defined by law and other regulations.
Securities can be categorised into three big groups. The first category of securities embodies a claim (debt securities). Typically, none of the parties in the contract know their obligations towards the other party exactly, yet agree to pay all their debts within a predefined period. The most common types of such claims are bills of exchange, checks, bonds, and deposit certificates.
The next category of securities deals with rights towards assets. They grant the right of disposal to the owner of the security. Warehouse warrants are the most common example in this group. The last category includes securities granting co-ownership rights (equity securities). They certify that the owner of the security has contributed to the capital resources of a given firm. Thus, entitle the owner to receive dividends in proportion of his or her ownership in the firm. Owners are usually forbidden to withdraw their funds from the business. The most common security in this group is the share of companies, but investment funds also belong here.