Economics 12 Notes for Economics Notes

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Concept of capital market

The market which deals with medium and long term financial instruments is called capital market. There are long term security transactions in capital market for more than one year to 25. Bonds, shares, debentures, etc are long termed securities. There are also transactions of non-security component for example long term loan provided by banks.

There are two sectors i.e. organized and unorganized. Banks, finance companies, insurance companies, stock exchange centers and center bank are included under the organized sectors as well as traditional money lender, traders, merchants, etc are under unorganized sectors.

According to World Bank, the market in which long term financial instruments such as equities and bonds are raised and traded.

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