Long-Term Investments

Multi-year investments in:

  • Debt securities: loans, notes, bonds, mortgages
  • Equity securities: shares of other companies

These assets are normally not intended to be sold (and converted to cash) within one year

Can anyone explain what's the difference between loans, notes, bonds and mortgages?


Loan is an umbrella term for individual(s)/organization(s)/government(s) borrowing from another individual(s)/organization(s)/government(s).

Mortgage is a type of loan for the purpose of obtaining funds for real estate which also puts lien on the property (meaning if you don’t pay the loan you will loose the property).

Note is a contract for loan with specific repayment date and interest. However, I am surprised that they are listed as long term finance as these are usually payable within 1 year (although there can be exceptions).

Bonds are very similar to notes except they have usually higher term to maturity and interest payments on bonds are usually called coupons.

These are by the way not even all possible long term debt instruments, you could for example have debentures and many more. Hence, the text probably just wanted to give you some examples of these.


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