MSG Team's other articles

13004 Cultural Influences on Financial Decisions

The financial decisions made by an investor are actually influenced by several factors that are present in their thought process. We have discussed about the rational aspects of traditional financial theory. We have also discussed about emotional aspects and behavioral biases in the previous articles. However, emotions are not the only thing that impact behavior. […]

10820 Pros and Cons of Relationship Banking

In the previous article, we studied what relationship banking is and how it is different as compared to transactional banking. The relationship banking model has become very popular, particularly in the field of commercial banking. It is important to understand the pros and cons of relationship banking in order to have enough information to make […]

11555 The TikTok Business Model

When we talk about social media, we often refer to companies like Facebook, Instagram, Twitter, and LinkedIn. However, in the past few years, another company has emerged as a huge player in the social media space. This company has created an application that is known for having high levels of user engagement. The application being […]

11351 The South Sea Bubble

The South Sea Bubble is one of the largest asset bubbles that the world has ever seen. In fact, this bubble bankrupted the newly prosperous British economy during the 17th Century. At one point in time, all the money is Britain was not enough to pay down the debts that accrued as a result of […]

10052 Issues in Determining Discount Rate for Valuation of Sports Franchises

In the previous article, we have already understood the method used for deriving the discount rate which is used while deriving the valuation of sports franchises. The method was described in detail. However, even though theoretically, there is a method available to derive the discount rate, there are several practical issues that make it difficult […]

Search with tags

  • No tags available.

A market is a place where two parties are involved in transaction of goods and services in exchange of money. The two parties involved are:

  • Buyer
  • Seller

In a market the buyer and seller comes on a common platform, where buyer purchases goods and services from the seller in exchange of money.

What is a Financial Market ?

A place where individuals are involved in any kind of financial transaction refers to financial market. Financial market is a platform where buyers and sellers are involved in sale and purchase of financial products like shares, mutual funds, bonds and so on.

Let us go through the various types of financial market:

Capital Market

A market where individuals invest for a longer duration i.e. more than a year is called as capital market. In a capital market various financial institutions raise money from individuals and invest it for a longer period.

Capital Market is further divided into:

  1. Primary Market: Primary Market is a form of capital market where various companies issue new stock, shares and bonds to investors in the form of IPO’s (Initial Public Offering). Primary Market is a form of market where stocks and securities are issued for the first time by organizations.

  2. Secondary Market: Secondary market is a form of capital market where stocks and securities which have been previously issued are bought and sold.

Types of Capital Market

  1. Stock Markets: Stock Market is a type of Capital market which deals with the issuance and trading of shares and stocks at a certain price.

  2. Bond Markets: Bond Market is a form of capital market where buyers and sellers are involved in the trading of bonds.

  3. Commodity Market: A market which facilitates the sale and purchase of raw goods is called a commodity market.

    Commodity market like any other market includes a buyer and a seller. In such a market buyer purchases raw products like rice, wheat, grain, cattle and so on from the seller at a mutually agreed rate.

  4. Money Market: As the name suggests, money market involves individuals who deal with the lending and borrowing of money for a short time frame.

  5. Derivatives Market: The market which deals with the trading of contracts which are derived from any other asset is called as derivative market.

  6. Future Market: Future market is a type of financial market which deals with the trading of financial instruments at a specific rate where in the delivery takes place in future.

  7. Insurance Market: Insurance market deals with the trading of insurance products. Insurance companies pay a certain amount to the immediate family members of owner of the policy in case of his untimely death.

  8. Foreign Exchange Market: Foreign exchange market is a globally operating market dealing in the sale and purchase of foreign currencies.

  9. Private Market: Private market is a form of market where transaction of financial products takes place between two parties directly.

  10. Mortgage Market: A type of market where various financial organizations are involved in providing loans to individuals on various residential and commercial properties for a specific duration is called a mortgage market. The payment is made to the individual concerned on submitting certain necessary documents and fulfilling certain basic criteria.

Article Written by

MSG Team

An insightful writer passionate about sharing expertise, trends, and tips, dedicated to inspiring and informing readers through engaging and thoughtful content.

Leave a reply

Your email address will not be published. Required fields are marked *

Related Articles

The Perils of the Immediacy Trap and Why we can and cannot do without it

MSG Team

What are Bonds? – Characteristics and Different Types of Bonds

MSG Team

What are Market Indices ?

MSG Team