{"id":114917,"date":"2024-10-05T11:00:08","date_gmt":"2024-10-05T05:30:08","guid":{"rendered":"https:\/\/www.practicemock.com\/blog\/?p=114917"},"modified":"2024-10-05T11:01:03","modified_gmt":"2024-10-05T05:31:03","slug":"what-is-capital-market-and-money-market","status":"publish","type":"post","link":"https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/","title":{"rendered":"What is Capital Market and Money Market, Features & Differences"},"content":{"rendered":"\n

<\/p>\n\n\n

Home<\/a><\/span> \u00bb Banking Awareness<\/a><\/span> \u00bb What is Capital Market and Money Market<\/span><\/span><\/div>\n\n\n

<\/p>\n\n\n\n

Capital Market and Money Market:<\/strong> The capital market and the money market are two of the most important sub-systems of the financial system, playing an important role in the overall functioning of the economy. While both markets deal with the flow of money, they serve different purposes and cater to different participants. It is equally essential for anyone who thinks about finance and investing or doing economic work to understand the nature, features, and distinguishing characteristics between these two markets.<\/p>\n\n\n\n

<\/p>\n\n\n\n

\n
Join Now! & Take Banking Online Preparation Courses<\/strong><\/a><\/div>\n<\/div>\n\n\n\n

<\/p>\n\n\n\n

\n
Static GK For All Government, Banking Exams- Download Free PDF<\/strong><\/a><\/div>\n<\/div>\n\n\n\n

<\/p>\n\n\n\n

What is a Capital Market?<\/h2>\n\n\n\n

The capital market is a financial market where long-term securities like stocks, bonds, and debentures are sold. Companies, governments, and institutions use the capital market to obtain finance for their long-term investments, such as developing infrastructure, expanding businesses, and financing corporations.<\/p>\n\n\n\n

Key Instruments Traded in Capital Markets<\/h3>\n\n\n\n

Stocks (Equities):<\/strong> These are portions of ownership in a company that gives investors the right to some profits (dividends).
Bonds (Debt Securities):<\/strong> Funds loaned by investors to borrowers in the form of corporations or governments, which promise periodic interest payments and return of principal at maturity.<\/p>\n\n\n\n

<\/p>\n\n\n\n

<\/p>\n\n\n\n

\n
Weekly Current Affairs- Download Free PDF<\/strong><\/a><\/div>\n<\/div>\n\n\n\n

<\/p>\n\n\n\n

\n
The Hindu Editorial Vocabulary- Download Free PDF<\/strong><\/a><\/div>\n<\/div>\n\n\n\n

<\/p>\n\n\n\n

Types of Capital Markets<\/h3>\n\n\n\n

Primary Market: <\/strong>New issues of securities to be sold to investors for the first time (e.g., initial public offerings).
Secondary Market: <\/strong>Transfer of existing securities among investors (e.g., stock exchanges such as the NYSE, and NASDAQ).<\/p>\n\n\n\n

What is a Money Market?<\/h2>\n\n\n\n

The money market is a financial market segment that deals with the short-term financial instrument whose maturity falls below one year. In its role, this market provides governments, banks, and corporations with liquidity enabling the parties to meet short-term financing needs.<\/p>\n\n\n\n

What are the Instruments in Money Markets?<\/h2>\n\n\n\n

Treasury Bills (T-Bills):<\/strong> These are government securities sold for short periods of time as tools to meet urgent cash needs.
Certificates of Deposit (CDs):<\/strong> Bearer certificates issued by banks on time deposits at specific rates and terms.
Commercial Paper: <\/strong>Short-term unsecured promissory notes issued by companies for direct financing of their working capital requirements.
Repurchase Agreements (Repos):<\/strong> Loan whereby a security is sold with an undertaking to repurchase the security at a later date at a higher price.<\/p>\n\n\n\n

Key Differences Between Capital Market and Money Market<\/h3>\n\n\n\n
Criteria<\/strong><\/td>Capital Market<\/strong><\/td>Money Market<\/strong><\/td><\/tr>
Purpose<\/strong><\/td>Long-term financing (more than 1 year)<\/td>Short-term financing (less than 1 year)<\/td><\/tr>
Instruments<\/strong><\/td>Stocks, bonds, debentures<\/td>Treasury bills, commercial paper, CDs, reports<\/td><\/tr>
Risk<\/strong><\/td>Higher risk due to longer duration <\/td>Lower risk due to short duration <\/td><\/tr>
Returns<\/strong><\/td>Potentially higher returns<\/td>Lower returns due to lower risk<\/td><\/tr>
Participants<\/strong><\/td>Both institutional and individual investors<\/td>Primarily institutional investors <\/td><\/tr>
Maturity<\/strong><\/td>Long-term instruments<\/td>Short-term instruments<\/td><\/tr>
Liquidity<\/strong><\/td>Less liquid compared to money markets<\/td>Highly liquid<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

<\/p>\n\n\n\n

\n
Join Now! & Take Banking Online Preparation Courses<\/strong><\/a><\/div>\n<\/div>\n\n\n\n

<\/p>\n\n\n\n

Banking Free Mock Test<\/h3>\n\n\n\n
IBPS RRB PO Free Mock Test <\/a><\/td>IBPS PO Free Mock Test <\/a><\/td><\/tr>
SBI PO Free Mock Test<\/a><\/td>IBPS SO Free Mock Test<\/a><\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

<\/p>\n\n\n\n

What is Capital Market and Money Market FAQ<\/h2>\n\n\n\n
What is a capital market?<\/strong>

The capital market<\/strong> is a financial market where long-term securities such as stocks, bonds, and debentures are bought and sold.<\/p> <\/div>

What is a money market?<\/strong>

The money market<\/strong> is a segment of the financial market where short-term borrowing, lending, and trading of securities take place, typically with maturities of one year or less.<\/p> <\/div> <\/div>\n\n\n\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

In this article we are providing the What is Capital Market and Money Market, Candidates can check features & differences in the article below<\/p>\n","protected":false},"author":13,"featured_media":114919,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_uag_custom_page_level_css":"","_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_uf_show_specific_survey":0,"_uf_disable_surveys":false,"footnotes":""},"categories":[3998],"tags":[],"class_list":["post-114917","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-banking-awareness"],"yoast_head":"\nWhat is Capital Market and Money Market, Features & Differences<\/title>\n<meta name=\"description\" content=\"In this article we are providing the What is Capital Market and Money Market, Candidates can check features & differences in the article below\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"What is Capital Market and Money Market, Features & Differences\" \/>\n<meta property=\"og:description\" content=\"In this article we are providing the What is Capital Market and Money Market, Candidates can check features & differences in the article below\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/\" \/>\n<meta property=\"og:site_name\" content=\"Practicemock\" \/>\n<meta property=\"article:published_time\" content=\"2024-10-05T05:30:08+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-10-05T05:31:03+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.practicemock.com\/blog\/wp-content\/uploads\/2024\/10\/What-is-Capital-Market-and-Money-Market-1.png\" \/>\n\t<meta property=\"og:image:width\" content=\"1280\" \/>\n\t<meta property=\"og:image:height\" content=\"768\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"author\" content=\"Sweta Singh\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Sweta Singh\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"What is Capital Market and Money Market, Features & Differences","description":"In this article we are providing the What is Capital Market and Money Market, Candidates can check features & differences in the article below","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/","og_locale":"en_US","og_type":"article","og_title":"What is Capital Market and Money Market, Features & Differences","og_description":"In this article we are providing the What is Capital Market and Money Market, Candidates can check features & differences in the article below","og_url":"https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/","og_site_name":"Practicemock","article_published_time":"2024-10-05T05:30:08+00:00","article_modified_time":"2024-10-05T05:31:03+00:00","og_image":[{"width":1280,"height":768,"url":"https:\/\/www.practicemock.com\/blog\/wp-content\/uploads\/2024\/10\/What-is-Capital-Market-and-Money-Market-1.png","type":"image\/png"}],"author":"Sweta Singh","twitter_card":"summary_large_image","twitter_misc":{"Written by":"Sweta Singh","Est. reading time":"3 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":["WebPage","FAQPage"],"@id":"https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/","url":"https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/","name":"What is Capital Market and Money Market, Features & Differences","isPartOf":{"@id":"https:\/\/www.practicemock.com\/blog\/#website"},"primaryImageOfPage":{"@id":"https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/#primaryimage"},"image":{"@id":"https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/#primaryimage"},"thumbnailUrl":"https:\/\/www.practicemock.com\/blog\/wp-content\/uploads\/2024\/10\/What-is-Capital-Market-and-Money-Market-1.png","datePublished":"2024-10-05T05:30:08+00:00","dateModified":"2024-10-05T05:31:03+00:00","author":{"@id":"https:\/\/www.practicemock.com\/blog\/#\/schema\/person\/81478099609dda7c1ff590d77e0eda45"},"description":"In this article we are providing the What is Capital Market and Money Market, Candidates can check features & differences in the article below","breadcrumb":{"@id":"https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/#breadcrumb"},"mainEntity":[{"@id":"https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/#faq-question-1727957475135"},{"@id":"https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/#faq-question-1727957763861"}],"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/#primaryimage","url":"https:\/\/www.practicemock.com\/blog\/wp-content\/uploads\/2024\/10\/What-is-Capital-Market-and-Money-Market-1.png","contentUrl":"https:\/\/www.practicemock.com\/blog\/wp-content\/uploads\/2024\/10\/What-is-Capital-Market-and-Money-Market-1.png","width":1280,"height":768,"caption":"What is Capital Market and Money Market"},{"@type":"BreadcrumbList","@id":"https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.practicemock.com\/blog\/"},{"@type":"ListItem","position":2,"name":"Banking Awareness","item":"https:\/\/www.practicemock.com\/blog\/category\/banking-awareness\/"},{"@type":"ListItem","position":3,"name":"What is Capital Market and Money Market"}]},{"@type":"WebSite","@id":"https:\/\/www.practicemock.com\/blog\/#website","url":"https:\/\/www.practicemock.com\/blog\/","name":"Practicemock","description":"Practice | Analyse | Excel","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.practicemock.com\/blog\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/www.practicemock.com\/blog\/#\/schema\/person\/81478099609dda7c1ff590d77e0eda45","name":"Sweta Singh","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.practicemock.com\/blog\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/b60a00fb7612e91419b4da6dd0046825acb56157c2d61a424b8ea84100716647?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/b60a00fb7612e91419b4da6dd0046825acb56157c2d61a424b8ea84100716647?s=96&d=mm&r=g","caption":"Sweta Singh"},"description":"Hi, I am Sweta Singh (B.Com Honours). I cleared many bank exams time by time but couldn't join because of my passion towards writing. I write blogs to help aspirants prepare for Banking and Insurance exams. These blogs turn out to be a one-stop destination for comprehensive information on some of the biggest competitive exams like SBI PO\/Clerk, IBPS PO\/Clerk, IBPS RRB PO\/Clerk and RBI. My ultimate goal is to provide accurate and easy-to-understand information, covering topics like exam patterns, syllabus, study techniques, and more. Join me on this journey of knowledge!","url":"https:\/\/www.practicemock.com\/blog\/author\/ss8860409gmail-com\/"},{"@type":"Question","@id":"https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/#faq-question-1727957475135","position":1,"url":"https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/#faq-question-1727957475135","name":"What is a capital market?","answerCount":1,"acceptedAnswer":{"@type":"Answer","text":"The <strong>capital market<\/strong> is a financial market where long-term securities such as stocks, bonds, and debentures are bought and sold.","inLanguage":"en-US"},"inLanguage":"en-US"},{"@type":"Question","@id":"https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/#faq-question-1727957763861","position":2,"url":"https:\/\/www.practicemock.com\/blog\/what-is-capital-market-and-money-market\/#faq-question-1727957763861","name":"What is a money market?","answerCount":1,"acceptedAnswer":{"@type":"Answer","text":"The <strong>money market<\/strong> is a segment of the financial market where short-term borrowing, lending, and trading of securities take place, typically with maturities of one year or less.","inLanguage":"en-US"},"inLanguage":"en-US"}]}},"uagb_featured_image_src":{"full":["https:\/\/www.practicemock.com\/blog\/wp-content\/uploads\/2024\/10\/What-is-Capital-Market-and-Money-Market-1.png",1280,768,false],"thumbnail":["https:\/\/www.practicemock.com\/blog\/wp-content\/uploads\/2024\/10\/What-is-Capital-Market-and-Money-Market-1.png",150,90,false],"medium":["https:\/\/www.practicemock.com\/blog\/wp-content\/uploads\/2024\/10\/What-is-Capital-Market-and-Money-Market-1.png",300,180,false],"medium_large":["https:\/\/www.practicemock.com\/blog\/wp-content\/uploads\/2024\/10\/What-is-Capital-Market-and-Money-Market-1.png",640,384,false],"large":["https:\/\/www.practicemock.com\/blog\/wp-content\/uploads\/2024\/10\/What-is-Capital-Market-and-Money-Market-1.png",640,384,false],"1536x1536":["https:\/\/www.practicemock.com\/blog\/wp-content\/uploads\/2024\/10\/What-is-Capital-Market-and-Money-Market-1.png",1280,768,false],"2048x2048":["https:\/\/www.practicemock.com\/blog\/wp-content\/uploads\/2024\/10\/What-is-Capital-Market-and-Money-Market-1.png",1280,768,false],"web-stories-poster-portrait":["https:\/\/www.practicemock.com\/blog\/wp-content\/uploads\/2024\/10\/What-is-Capital-Market-and-Money-Market-1.png",640,384,false],"web-stories-publisher-logo":["https:\/\/www.practicemock.com\/blog\/wp-content\/uploads\/2024\/10\/What-is-Capital-Market-and-Money-Market-1.png",96,58,false],"web-stories-thumbnail":["https:\/\/www.practicemock.com\/blog\/wp-content\/uploads\/2024\/10\/What-is-Capital-Market-and-Money-Market-1.png",150,90,false]},"uagb_author_info":{"display_name":"Sweta Singh","author_link":"https:\/\/www.practicemock.com\/blog\/author\/ss8860409gmail-com\/"},"uagb_comment_info":12,"uagb_excerpt":"In this article we are providing the What is Capital Market and Money Market, Candidates can check features & differences in the article below","_links":{"self":[{"href":"https:\/\/www.practicemock.com\/blog\/wp-json\/wp\/v2\/posts\/114917","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.practicemock.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.practicemock.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.practicemock.com\/blog\/wp-json\/wp\/v2\/users\/13"}],"replies":[{"embeddable":true,"href":"https:\/\/www.practicemock.com\/blog\/wp-json\/wp\/v2\/comments?post=114917"}],"version-history":[{"count":0,"href":"https:\/\/www.practicemock.com\/blog\/wp-json\/wp\/v2\/posts\/114917\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.practicemock.com\/blog\/wp-json\/wp\/v2\/media\/114919"}],"wp:attachment":[{"href":"https:\/\/www.practicemock.com\/blog\/wp-json\/wp\/v2\/media?parent=114917"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.practicemock.com\/blog\/wp-json\/wp\/v2\/categories?post=114917"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.practicemock.com\/blog\/wp-json\/wp\/v2\/tags?post=114917"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}