Following the Federal Reserve's decision to cut interest rates by 50 basis points, markets surged with optimism, particularly on Wall...
Financial Markets
Financial markets refer to platforms or systems where individuals and institutions can buy, sell, and trade financial securities, commodities, and other instruments. These markets facilitate the exchange of assets such as stocks, bonds, currencies, and derivatives, thereby enabling the allocation of capital and liquidity in the economy. They are characterized by various participants, including retail investors, institutional investors, brokers, and market makers who contribute to price discovery and market efficiency. Financial markets can be categorized into primary markets, where new securities are issued, and secondary markets, where existing securities are traded. The functioning of financial markets is critical for economic growth as they provide businesses with funding, facilitate investment opportunities for individuals, and help in price setting and risk management. Key examples of financial markets include stock exchanges, bond markets, and foreign exchange markets.
