RASHID AZEEM

Financial markets
The financial markets are markets which facilitate the raising of funds or the investment of assets, depending on viewpoint. They also facilitate handling of various risks. The financial markets can be divided into different sub typs

Capital markets
consists of: Stock markets, which facilitates equity investment and buying and selling of shares.

Bond markets,
which provides financing through the issue of debt contracts and the buying and selling of bonds and debentures.

Money markets,
which provides short term debt financing and investment.

Derivatives markets,
which provides instruments for handling of financial risks.

Futures markets,
which provide standardised contracts for trading assets at some forward date; see also forward market.

Insurance markets,
which facilitates handling of various risks.

Foreign exchange markets

These markets can be either primary markets or aftermarkets.

Money market
A financial market in which short-term debt instruments (bills, paper, acceptances, etc.) are traded that generally have maturities of one year or less.

Securities market
A place or places where securities are bought and sold, the facilities and people engaged in such transactions, the demand for and availability of securities to be traded, and the willingness of buyers and sellers to reach agreement on sales. Securities markets include over-the-counter markets, the New York Stock Exchange, the Chicago Board of Trade and the American Stock Exchange.

Money market fund

The combined money of many individuals which is jointly invested in high yield financial instruments including U.S. government securities, certificates of deposit, and commercial paper. A money market fund is a mutual fund which strives to make a profit by buying and selling various forms of money rather than buying and selling shares of ownership in corporations.

Money market mutual fund (MMMF)

Is simply a mutual fund that invests exclusively in high-yielding shortterm securities, such as Treasury bills, large certificates of deposits, and commercial paper. MMMFs are sold in denominations of $10,000 to $1 million or more, meaning most individual investors cant purchase them. Money market certificate A certificate of deposit that when first authorized had a fixed maturity of six months and a $2,500 minimum deposit, with rates based on the weekly posting of average yields for United States Treasury bills. With deregulation in the 1980s, federal regulators now leave it up to each individual thrift institution to determine the maturity and yield of this savings instrument.

Stock market index A stock market index is a tool for measuring the performance of an entire stock market or group of related stocks. These indices are often associated with particular stock exchanges or industries. They exist because changes in a market index can reflect a more general price trend than a change in individual stock prices. Market failure In economics, a market failure is a case in which a market fails to efficiently provide or allocate goods and services. More generally, market failure refers to situations where market forces do not serve the perceived "public interest."

Market form In economics, the main criteria by which one can distinguish between different market forms are: the number and size of producers and

consumers on the market, the type of goods and services being traded, and the degree to which information can flow freely.

Marketability The relative ease in which an asset can be sold quickly at a price near the price at which similar assets are selling.

Market in which long-term debt and equity securities are bought and sold

Market capitalization The total value of a companys outstanding shares. To find the market cap of a company multiply the market price of the stock by the number of shares outstanding. Net working capital Equal to current assets minus current liabilities. It is the total amount of liquid resources available to a business.

Secondary mortgage market A market through which existing mortgage loans are bought and sold to other lenders, to government or private agencies, or to investors. Mortgage loans are originated to home buyers in the primary market and sold to investors in the secondary market. Physical capital

Physical capital refers to any manufactured asset that is applied production, such as machinery, buildings, or vehicles, which is one of the three primary factors of production (the other two are land and labor/workforce). One of three capital standards adopted for savings institutions in 1989. The standard is designed to require savings institutions to hold more capital for higher-risk assets. The value of each asset is weighted according to its risk and then capital is calculated at a fixed percent of each risk-weighted asset. The standard adopted in 1989 was 8 percent of risk-weighted assets. See tangible capital and core capital
Primary market The market in which new issues of securities are first offered to the public. This first offering of shares publicly is called the initial public offering. Proceeds from primary offerings go directly to the issuer.

Definition of 'Bond' A debt investment in which an investor loans money to an entity (corporate or governmental) that borrows the funds for a defined period of time at a fixed interest rate. Bonds are used by companies, municipalities, states and U.S. and foreign governments to finance a variety of projects and activities. Bonds are commonly referred to as fixed-income securities and are one of the three main asset classes, along with stocks