What are examples of capital market instruments?

What are examples of capital market instruments?

Capital market instruments used for market trade include stocks and bonds, treasury bills, foreign exchange, fixed deposits, debentures, etc. As they involve debts and equity securities, the instruments are also called securities, and the market is referred to as securities market.

What are the different instruments of capital market explain?

The main instruments traded in the capital market are – equity shares, debentures, bonds, preference shares etc. The main instruments traded in the money market are short term debt instruments such as T-bills, trade bills reports, commercial paper and certificates of deposit.

What are the different types of capital markets?

Capital market consists of two types i.e. Primary and Secondary.

  • Primary Market. Primary market is the market for new shares or securities.
  • Secondary Market. Secondary market deals with the exchange of prevailing or previously-issued securities among investors.

What are the capital instruments?

Meaning of capital instrument in English a security in the form of shares, bonds, etc. that a company sells to raise the money it needs to operate: Legally, capital instruments are debt and should therefore be disclosed within liabilities.

Is commercial paper a capital market instruments?

Commercial paper, also called CP, is a short-term debt instrument issued by companies to raise funds generally for a time period up to one year. It is an unsecured money market instrument issued in the form of a promissory note and was introduced in India for the first time in 1990.

Is Treasury bill a capital market instruments?

Treasury Bills are short term money market instruments issued by the government to raise short-term funds. Whenever the government needs money for a shorter period Treasury bills are issued by them to raise the funds. whereas Treasury bonds are a capital market instrument.

What are the instruments of capital market in India?

Beginners guide to access the Indian Capital Market

Sr. No. Instrument
1. Equity Shares
2. Debentures, Bonds and Corporate Deposits
3. Mutual Funds
4. Government Securities

What are the primary market instruments?

Primary instruments include cash-traded products like stocks, bonds, currencies, and spot commodities. Understanding primary instruments provides the base knowledge for derivatives, whose prices are derived from the primary (underlying) asset.

Are bonds capital market instruments?

1. Bonds: It can be referred to as a loaning capital market instrument, where the issuer of the bond is known as the borrower. Bonds generally carry a fixed lock-in period.

What is capital market and instruments of capital market?

Capital market which is also known as the securities market is a trading market that garners capital from the investors and makes them available to companies and the government for development of projects. The capital market consists of development bank, commercial banks and stock exchanges.

What are the instruments of financial market?


Asset class Instrument type
Securities OTC derivatives
Debt (short term) ≤ 1 year Bills, e.g. T-bills Commercial paper Forward rate agreements
Equity Stock Stock options Exotic derivatives
Foreign exchange N/A Foreign exchange options Outright forwards Foreign exchange swaps Currency swaps

What are the types of capital market?

Two commonly known types of the capital market are the primary and secondary markets where equities are bought directly from the companies issuing them or are bought and sold between investors.

What are the different types of capital market products?

Equity securities

  • Commodities
  • Debt securities
  • Foreign exchange
  • Derivatives
  • What are some examples of capital market securities?

    Examples of highly organized capital markets are the New York Stock Exchange, American Stock Exchange, London Stock Exchange, and NASDAQ. Securities can also be traded ” over the counter ,” rather than on an organized exchange. These securities are usually issued by entities whose business fundamentals (such as revenue,…

    What is the function of capital market?

    The capital market functions as a link between savers and investors. It plays an important role in mobilising the savings and diverting them in productive investment.