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What is the difference between a debt investor and a equity investor?

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A debt investor purchases bonds or debentures, thus invests in a firm or institution without owning part of its property. The money is lent for a defined period of time at an interest rate.

An equity investor purchases shares of a company and is entitled to a share in its profits. These funds will not be returned in the normal course of the business. Investors may sell their shareholdings to other investors.

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