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A financial market is a broad term describing any marketplace where buyers and sellers participate in the trade of assets such as equities, bonds, currencies and derivatives. e.g., a stock exchange or commodity exchange.
# Types of Financial Market
# Stock markets,
#Foreign exchange markets,
1. capital markets:
Capital markets are markets for buying and selling equity and debt instruments. Capital markets channel savings and investment between suppliers of capital such as retail investors and institutional investors, and users of capital like businesses, government and individuals.
The capital markets may also be divided into primary markets and secondary markets.
A. primary markets:
Newly formed (issued) securities are bought or sold in primary markets, such as during initial public offerings. The transactions in primary markets exist between issuers and investors
B. secondary markets. : Secondary markets allow investors to buy and sell existing securities. secondary market transactions exist among investors.
a. Stock Market
Stock markets allow investors to buy and sell shares in publicly traded companies. Any subsequent trading of stock securities occurs in the secondary market.
b. Over-The-Counter Market
An OTC market handles the exchanging of public stocks not listed on the NASDAQ, New York Stock Exchange etc.
c. Bond Markets
A bond is a security in which an investor loans money for a defined period of time at a pre-established rate of interest.
Bond markets, which provide financing through the issuance of bonds, and enable the subsequent trading thereof.
A money market is a portion of the financial market that trades highly liquid and short-term maturities.
The derivatives market is a financial market that trades securities that derive its value from its underlying asset.
The forex market is a financial market where currencies are traded. This financial market is the most liquid market in the world as cash is the most liquid of assets.
A cash market is a marketplace for the immediate settlement of transactions involving commodities and securities.
The interbank market is the financial system and trading of currencies among banks and financial institutions
The market in which shares are issued and traded, either through exchanges or over-the-counter markets. It is Also known as the stock market
A commodity market is a physical or virtual marketplace for buying, selling and trading raw or primary products,