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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 subtypes: - Capital markets consists of:
- Stock markets, which facilitates equity investment and buying and selling of shares of stock.
- Bond market s, 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 marketsInsurance is the business of providing protection against financial aspects of risk, such as those to property, life, health and legal liability. It is one method of the overall concept known as risk management. Introduction In insurance, the insured make, which facilitates handling of various risks.
- Foreign exchangeIn finance, the exchange rate between two currencies specifies how much one currency is worth in terms of the other. For example an exchange rate of 120 Japanese Yen to the Dollar means that ¥120 is worth the same as $1. An exchange rate is also known as markets
These markets can be either primary marketThe primary market is the financial market for the initial issue and placement of securities. Unlike in the secondary market, no organized stock exchanges are necessary. An organization that need funds contacts their investment banker who typically assembs or aftermarketThe aftermarket (also called secondary market is the financial market for trading of already issued securities. In the secondary market, securities are sold by and transferred from one investor to another. It is therefore important that the secondary marks.
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