Debenture

A debenture may mean nay type of corporate debt, but usage varies in different countries and it may mean any number of different types of bond or note. In the US a debenture implies a bond that is not secured (thereby ranking lower for repayment in liquidation then secured debt) whereas in the UK debentures are usually secured).

In practice, the usage is loose enough that it does not provide reliable information, so an investor should look at the terms of a particular bond: whether it is secured or not, and if it is secured whether it is a fixed charge (against a particular asset) or a floating charge (against a company's assets in general) and what other debt may be secured against the same assets. Investors also need to look at other terms such as what debt covenants have been agreed (even if related to other debt). This is, of course, in addition to analysis of the company's financial strength.

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