Security is the legal right given to a creditor by a borrower.
In modern commerce, the creation of fungible credit, such legal interest became transformed as business people accepted the notes of third parties that were backed by credit worthy parties (banks). As a consequence a security became a type of transferable interest representing financial value. Traditionally, securities have been categorized into debt and equity securities, and between bearer and registered securities.
The uses that are made of securities have changed over time, for both the issuer and holder. Though the purpose of capital raising has sometimes been taken to be a defining characteristic of securities, its uses have expanded greatly in modern times.