Listen to a Business English Dialogue about Junior securities
Jack: Hey Scarlett, have you heard about junior securities in the financial market?
Scarlett: No, I haven’t. What are they?
Jack: Junior securities are typically lower-ranked or riskier investments compared to senior securities and may include things like junior bonds or preferred stocks.
Scarlett: Ah, I see. So, what makes them riskier than senior securities?
Jack: Well, junior securities have a lower priority in terms of repayment if the issuer faces financial difficulties or goes bankrupt, which means they carry a higher risk of default.
Scarlett: Got it. Are there any advantages to investing in junior securities?
Jack: Despite the higher risk, investors may be attracted to junior securities because they often offer higher potential returns compared to senior securities.
Scarlett: That makes sense. How do investors determine if investing in junior securities is right for them?
Jack: It depends on their risk tolerance and investment goals. Investors who are willing to take on higher risk in exchange for potentially higher returns may find junior securities appealing.
Scarlett: Thanks for explaining, Jack. I’ll definitely look into junior securities more closely.
Jack: You’re welcome, Scarlett. If you have any more questions, feel free to ask.