Debt securities are essentially contracts that obligate the issuer of the security to pay back the principal amount on a specified date, while also providing periodic interest payments to the bondholder. They are typically issued as bonds, notes, or debentures, and can vary in terms of risk, maturity, and yield. Investors in debt securities are essentially lending money to the borrowers, with the expectation of receiving their returns in terms of fixed interest payments and principal upon maturity.