Financial instrument :
Any contract that gives rise to both a financial asset of one entity and a financial liability or equity instrument of another entity.
This is a contract if a party is holding then it can give benefit to the holder.
This is a contract if a party is holding then it will deliver cash to other party or cost us something when exchanging financial instrument.
Eg, Debt; redeemable preference shares.
Something not for cash or any other assets but they are settled in shares.
Eg, Shares; irredeemable preference shares.