Watch this video to learn about the two pillars of the capital structure - equity and debt. Equity is represented by the different kinds of stock sold to investors and debt by the bonds and notes created to borrow money.
While the concepts of risk and return may be common to both debt and equity, debt investment has its own language, principles, and metrics. Familiarity with these unique aspects is important for complete understanding of the market.
Because the S&P 500 index is sometimes viewed as a surrogate for the performance of the overall U.S. equity market, many people assume that the range of potential equity investment might be only 500 individual companies.