Financial Markets

Financial markets refer to platforms and systems that facilitate the exchange of financial instruments, such as stocks, bonds, currencies, and derivatives. These markets enable individuals, businesses, and governments to buy and sell securities, providing liquidity and price discovery. Financial markets can be categorized into primary markets, where new issues of securities are sold to investors, and secondary markets, where existing securities are traded among investors. They play a crucial role in the economy by allocating resources efficiently, enabling investment, and facilitating the management of risk. Financial markets can be classified into various types, including capital markets (for long-term securities), money markets (for short-term debt), foreign exchange markets (for currency trading), and derivatives markets (for options and futures). Overall, financial markets are essential for economic growth and stability, as they provide a mechanism for raising capital and managing financial risk.