Kinds of Debentures
1. Redeemable Debentures 2. Irredeemable Debentures 3. Bearer Debentures
Depending on the nature of payment or maturity period, below mentioned are some types of debenture:
4. Registered Debentures 5. Convertible Debentures 6. Naked Debentures
Shares V/S Debentures Returns
Payment Policies
Shares - The rate of dividend is entirely based on the profits earned by the company.
Shares - Shareholders are paid after debenture holders get their interest.
Debentures - The rate of interest is fixed no matter if the company is in profit or loss.
Debentures - Debenture holders get the priority over shareholders when it comes to payment of interest or dividend.
Obligations Shares - The dividend earning of the shareholder entirely depends on the profit earned by the company. Debentures - The company is obliged to pay interest to the debenture holders no matter the company is in profit or loss.
Companies Exiting Shares - Shareholders might lose their part of ownership in companies’ profits if the company winds up its business.
Shares V/S Debentures
Recommended Articles ★ Shares and Debentures - The Capital Raising Tools for Companies ★ Details of a Demat Account - Introduction, Benefits and Steps to Acquire One ★ The Difference Between Equity and Preference Shares ★ Differences Between Equity Shares and Preference Shares
