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Financial_market - Financial market Wikipedia the free...

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Financial market From Wikipedia, the free encyclopedia In economics, a financial market is a mechanism that allows people to easily buy and sell (trade) financial securities (such as stocks and bonds), commodities (such as precious metals or agricultural goods), and other fungible items of value at low transaction costs and at prices that reflect the efficient-market hypothesis. Financial markets have evolved significantly over several hundred years and are undergoing constant innovation to improve liquidity. Both general markets (where many commodities are traded) and specialized markets (where only one commodity is traded) exist. Markets work by placing many interested buyers and sellers in one "place", thus making it easier for them to find each other. An economy which relies primarily on interactions between buyers and sellers to allocate resources is known as a market economy in contrast either to a command economy or to a non-market economy such as a gift economy. In finance, financial markets facilitate – square6 The raising of capital (in the capital markets); square6 The transfer of risk (in the derivatives markets); square6 International trade (in the currency markets) – and are used to match those who want capital to those who have it. Typically a borrower issues a receipt to the lender promising to pay back the capital. These receipts are securities which may be freely bought or sold. In return for lending money to the borrower, the lender will expect some compensation in the form of interest or dividends. In mathematical finance, the concept of a financial market is defined in terms of a continuous-time Brownian motion stochastic process. Contents square6 1 Definition square6 2 Types of financial markets square6 3 Raising capital square6 3.1 Lenders square6 3.1.1 Individuals square6 3.1.2 Companies square6 3.2 Borrowers square6 4 Derivative products Finance Financial markets Bond market Stock (Equities) Market Forex market Derivatives market Commodity market Money market Spot (cash) Market OTC market Real Estate market Private equity Market participants Investors Speculators Institutional Investors Corporate finance Structured finance Capital budgeting Financial risk management Mergers and Acquisitions Accounting Financial Statements Auditing Credit rating agency Leveraged buyout Venture capital Personal finance Credit and Debt Employment contract Retirement Financial planning Page 1 of 6 Financial market - Wikipedia, the free encyclopedia 8/17/2009 http://en.wikipedia.org/wiki/Financial_market
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Definition In economics, typically, the term market means the aggregate of possible buyers and sellers of a thing and the transactions between them. The term "market" is sometimes used for what are more strictly exchanges , organizations that facilitate the trade in financial securities, e.g., a stock exchange or commodity exchange. This may be a physical location (like the NYSE) or an electronic system (like NASDAQ). Much trading of stocks takes place on an
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