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financial institutions, financial instruments or products and financial instruments. The economic development of a nation is depending on the progress of the economic units, broadly classified into corporate sector, government and household sector. Some of the sector may be in surplus and some of them may in deficit. A financial system or financial sector functions as an intermediary and facilitates the flow of funds from the areas of surplus to the areas of deficit.
FINANCIAL INSTITUTION
FINANCIAL MARKET
FINANCIAL SYSTEM
FINANCIIAL SERVICES
FINANCIAL INSTRUMENTS
2. FINANCIAL INSTRUMENTS:financial instruments represent a claim against the future income and wealth of others. It will be a claim against a person or an institutions, for the payment of the some of the money at a specified future date. for e.g:- shares, debenture, bonds, fixed deposits
CONTI..
3. FINANCIAL SERVICES:Financial services is any kind of services of a financial nature offered by a financial service provider. All Banking & Insurance related services are include
4.FINANCIAL MARKET:Finance is a prerequisite for modern business and financial institutions play a vital role in economic system. It's through financial markets the financial system of an economy works. The main functions of financial markets are:
1. to facilitate creation and allocation of credit and liquidity; 2. to serve as intermediaries for mobilization of savings; 3. to assist process of balanced economic growth; 4. to provide financial convenience
FINANCIAL MARKET
A Financial market deals in financial assets & instruments such as currency, deposits, cheque & bill etc. financial transactionsthrough the creation,sale and transfer of financial securities, Part of the economy, Companies and governments need to raise capital,Allow investors toinvest in financial securities and earn a reasonable rate of return.
FINANCIAL MARKET
CAPITAL MARKET
MONEY MARKET
PRIMARY MARKET
SECONDARY MARKET
I.Capital Market
Capital Market is a market for financial investments that are direct or indirect claims to capital. It comprises of the institutions and mechanisms through which funds are pooled and made available to business, government and individuals
A. PRIMARY MARKET
Primary market is a market in which companies issues shares or
market is the market where the securities are sold for the first time. Therefore it is also called the new issue market
If public limited company issues shares for the 1st time, it is
B.SECONDARY MARKET
Secondary market is a market in which old shares or shares already issued by the companes are traded. It is stock market.
SECURITIES EXCHANGE BOARD OF INDIA Primary market will not function withoutwell-organized and efficient secondarymarket, Must have depth and width characteristics:
Liquid
Well regulated
II.MONEY MARKET
The money market is a market for short-term financial assets that are close substitutes of money.
is liquid and can be turned over quickly at low cost and provides an avenue for equilibrating the short-term surplus funds of lenders and the requirements of borrowers
acceptances, certificates of deposit, federal funds, and short-lived mortgage- and asset-backed securities
It is regulated by RBI
Indian Money Market. Under call money market, funds are transacted on overnight basis and under notice money market, funds are transacted for the period be 2 days and 14 days The call money is the money lent for one day
Deals with overnight borrowing and lending Provides funds that can be used to conduct transactions between
The call money loan essentially works in the same manner as a day to day loan.
B.GOVT.SECURITIES MARKET
The Government securities market consists of securities issued by
the temporary cash mismatches of the Government. All entities registered in India like banks, financial institutions, Primary Dealers, firms, companies, corporate bodies, partnership firms, institutions, mutual funds, Foreign Institutional Investors, State Governments, Provident Funds, trusts, research organisations, Nepal Rashtra bank and even individuals are eligible to purchase Government Securities.
They are generally by banks and institutions with the Reserve Bank
Capital market
Money Market
Financial Market
Derivatives Market Insurance Market
Foreign Exchange Market
Conclusion
Investors looks at superior returns and measured risk therefore he has to select a dynamically balanced asset allocation mix consisting of the different investment options available in the Financial Market. Thus Financial market Acts as a backbone of financial structure of any country. Acts as an interface between prospective buyers and sellers. Improves overall business liquidity. Helps in raising capital and improving international trade..