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‘ Market Statistics ’ category archive

Money Market..

February 15, 08 by FinanceTurf

Money market is the market for short term funds meant for use for a period of up to 1 year.
Money market provides means for raising funds for meeting short term requirements so cash on one hand, and the deployment of surplus funds for short periods on the other.

The money market consists of financial institutions and dealers in money or credit who wish to either borrow or lend. Participants borrow and lend for short periods of time.

Money market trades in short term financial instruments commonly called "paper".

This contrasts with the capital market for longer-term funding, which is supplied by bonds and equity. The money market is not a particular place in a geographical sense.

It is a term to describe all organizations and institutions which deal or facilitate dealings in short term debt instruments.
These instruments include the Reserve Bank, the State Bank of India, other commercial banks, cooperative banks, LIC, GIC, and UTI.

Money Market
Money Market

Common Money Market Instruments are:-

• Banker’s acceptance - A draft issued by a bank that will be accepted for payment, effectively the same as a cashier’s check.

• Certificate of deposit - A time deposit at a bank with a specific maturity date; large-denomination certificates of deposits can be sold before maturity.

• Repurchase agreements - Short-term loans-normally for less than two weeks and frequently for one day-arranged by selling securities to an investor with an agreement to repurchase them at a fixed price on a fixed date.

• Commercial paper - An unsecured promissory notes with a fixed maturity of one to 270 days; usually sold at a discount from face value.

• Treasury bills - Short-term debt obligations of a national government that are issued to mature in 3 to 12 months.

• Money market mutual funds - Pooled short maturity, high quality investments which buy money market securities on behalf of retail or institutional investors.

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Secondary Market (Stock Exchange)

February 15, 08 by FinanceTurf

The secondary market is the market for the sale and purchase of previously issued securities. In the secondary market, securities are sold by and transferred from one investor or speculator to another.

It is therefore important that the secondary market be highly liquid (Originally, the only way to create this liquidity was for investors and speculators to meet at a fixed place regularly. This is how stock exchanges originated).

It derives its name from the fact that it is not the place of origin of the security, but the place where subsequent transactions of sale and purchase occur.

Securities in the market are not issued by the company directly to investors. Securities issued earlier are sold by an existing investor to another.

The company is not involved in the transaction at all. Any investor holding a security may choose to sell it. Likewise, any intending investor may wish to buy the security which had previously been issued by the company.

Kuwait Stock Exchange
Kuwait Stock Exchange

However, the intending buyer cannot by the security from the company because it had already sold it out at the time of the public issue. The intending buyer and seller need not know each other.

Brokers in the stock exchange are needed to serve as intermediaries between them.Secondary market does not directly contribute to capital formation.
The company does not receive or pay any money but performs an important function.

They impart liquidity to investment and enhance the marketability of securities.

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Capital Market

February 13, 08 by FinanceTurf

The capital market is the market for medium and long term funds. It refers to all the organizations, institutions and instruments that provide long term funds.

The organizations and institutions which constitute the capital market include the new issue market, the stock exchange, the mutual funds, insurance companies, investment banks.

The capital market mainly focuses on meeting long term financial needs of the business sector.

Global Market In Hand
Global Market In Hand

The business enterprise utilizes this market to procure finances for long term investments, such as buying plant ,machinery ,buildings, etc. funds in the capital market are raised by issuing a wide variety of securities which includes :-

• Equity shares or ownership securities
• Debentures or creditor ship securities
• Preference shares or securities having preferential claims
• Other innovative securities which are variant s securities, with new features added to provide a wider choice to investors.

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All About Market..

February 12, 08 by FinanceTurf

Financial market is a crucial link in the saving investment process.They serve to transfer money capital or financial resources from savers to entrepreneurial borrowers. ’

Financial markets bring together borrowers and lenders, making available funds to those willing to pay for their use ’. Financial markets consists of two major segments

1. Capital Market - the market for medium and long term funds
2. Money Market - the market for short term funds…

Financial markets facilitate:

The raising of capital (in the capital markets);
The transfer of risk (in the derivatives markets); and
International trade (in the currency markets).

They are used to match those who want capital to those who have it.