You may have heard the word financial market a lot of times but have you ever thought about what a financial market is, says Rowan Relton. It refers to a place where asserts or securities are bought or sold. The financial market has many names: money market, capital market, and many more. These markets can be in physical form or can provide online services.
In this blog, Rowan Relton will talk about financial markets, their types and function.
Types of financial markets
1- Stock market
The most popular financial market is the stock market but what are stocks? They are the ownership claims on the business. The price of stocks depends upon the investor's sappiness regarding the performance of the business other factors are also involved, says Rowan Relton – commodity trader. The stocks are brought by authorized brokers only. The stock market has its risks so be careful before you step into this trading sector.
2- Bond or debt market
What are bonds? They are financial instruments in which the provider of the bond is indebted to repay the principal amount with predefined interest to the buyer. And this market involves buying, issuing, government bonds, corporate bonds, and other fixed income security. If the provider fails to repay the debt it is considered as default. Every bond has a different maturity tenure and interest rate.
