Nope, they're not interchangeable. Here's a quick breakdown:
Fixed income security: Usually refers to bonds or other debt instruments that pay a fixed amount of interest over a period of time. They provide regular income payments at intervals (like semi-annually, annually).
Equity: Refers to stocks or shares in a company. They represent ownership in a company and don't guarantee any fixed payments. Profits from equities come from capital gains (stock price going up) or dividends.
So, "fixed income" is more about regular, predictable payments, while "equity" is more about ownership and potential growth (or loss).
Note: Although the source text uses the term "Fixed Income Equity" in a couple of difference places, I find that a little confusing. The adjective "Fixed Income" in front of the term "Equity" is somewhat unconventional, but I wouldn't worry too much about it for the purpose of learning the material for the exam.
Comments
Nope, they're not interchangeable. Here's a quick breakdown:
Fixed income security: Usually refers to bonds or other debt instruments that pay a fixed amount of interest over a period of time. They provide regular income payments at intervals (like semi-annually, annually).
Equity: Refers to stocks or shares in a company. They represent ownership in a company and don't guarantee any fixed payments. Profits from equities come from capital gains (stock price going up) or dividends.
So, "fixed income" is more about regular, predictable payments, while "equity" is more about ownership and potential growth (or loss).
Note: Although the source text uses the term "Fixed Income Equity" in a couple of difference places, I find that a little confusing. The adjective "Fixed Income" in front of the term "Equity" is somewhat unconventional, but I wouldn't worry too much about it for the purpose of learning the material for the exam.