Description
Capital markets are financial markets for the buying and selling of long-term debt- or equity-backed securities. These markets channel the wealth of savers to those who can put it to long-term productive use, such as companies or governments making long-term investments
Meaning of Capital Market
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Market for securities, where companies and the government can raise long-term funds. Refers to all institutions and procedures that are involved in issuing, raising or trading of long term financial instruments. Term loans, corporate equities, and bonds
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CAPITAL MARKET
ORGANISED
UNORGANISED
SECURITIES STOCK MARKET
LOANS FROM BANKS & OTHER INSTITUTES GOVERNMENT SECURITIES
CORPORATE SECURITIES
PRIMARY MARKET
SECONDARY MARKET
Unorganized Capital Market
•
Completely insulated from any control of the RBI and not subjected to any statutory reserve. Such as chit funds - conducted between friends or relatives.
•
Organized Capital Market
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Includes institutions operating on given guidelines of RBI and other statutory bodies like SEBI. Two types: -Stock market -loans from banks and non-banks. For example: –Mutual Funds (Long term) -ICICI Bank
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Organized Capital Market - Loans
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Main source of financing for the firms that do not issue security. Cheapest form of finance.
Sources – Banks( and other institutes and lenders. Types – Secured And Unsecured
(Credit Card &Personal loan)
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Organized Capital Market Stock Market
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Place where shares are purchased and sold. Size $51 trillion Deals in long term securities (funds) from both private and government. Includes corporate securities and government securities. Example- Bombay Stock Exchange
Stock Market - Government securities
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Instruments used for raising long term capital from the public. No risk involved in normal circumstances.
Example - Government bonds.
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Stock Market -Corporate Securities
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Instruments used for raising long term corporate capital from the public. Examples-issues of shares, debentures.
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Corporate Securities -Primary Market
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Part of corporate securities.
Also called as New Issues Market. Deals in issuing of new securities in the form of public issues, rights issues or private placements to raise the capital of corporate enterprise.
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Corporate Securities -Secondary Market
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Provides a market place for purchase and sale of old securities.
Provides liquidity to old stock for firm and investors. Example-Stock exchanges.
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Types of Secondary Market
Organized security exchanges• • •
Tangible entities. Physically occupy space (such as a building or part of a building). Financial instruments are traded on their premises. over the counter marketsInformal market where negotiated deals take place.
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DIFFERENCE BETWEEN PRIMARY & SECONDARY MARKET
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In the primary market, securities are offered to public for subscription for the purpose of raising capital or fund.
For example -Reliance Power
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Secondary market is an equity trading avenue in which already existing/preissued securities are traded amongst investors. For example -Reliance Petroleum -DLF
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Stock Exchange
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Centres for trading of securities Total 24 stock exchanges in India22 are regional stock exchanges 2 are primary stock exchanges
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-National Stock Exchange -Bombay Stock Exchange
National Stock Exchange
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Set up in June 1994. Provides fully automated screen-based trading system across the country. Has S&P NSE 50 Index( Nifty).
?
?
Bombay Stock Exchange
Established in1987.
BSE Index- BSE Sensex comprising of 30 stocks.
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?
Facts about Indian capital Market
?
India’s capital market includes primary, secondary, Over the counter market.
Securities Board of Exchange(SEBI)Central regulatory authority and regulates capital markets in India.
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THANK YOU
doc_577562116.ppt
Capital markets are financial markets for the buying and selling of long-term debt- or equity-backed securities. These markets channel the wealth of savers to those who can put it to long-term productive use, such as companies or governments making long-term investments
Meaning of Capital Market
?
Market for securities, where companies and the government can raise long-term funds. Refers to all institutions and procedures that are involved in issuing, raising or trading of long term financial instruments. Term loans, corporate equities, and bonds
?
?
CAPITAL MARKET
ORGANISED
UNORGANISED
SECURITIES STOCK MARKET
LOANS FROM BANKS & OTHER INSTITUTES GOVERNMENT SECURITIES
CORPORATE SECURITIES
PRIMARY MARKET
SECONDARY MARKET
Unorganized Capital Market
•
Completely insulated from any control of the RBI and not subjected to any statutory reserve. Such as chit funds - conducted between friends or relatives.
•
Organized Capital Market
?
Includes institutions operating on given guidelines of RBI and other statutory bodies like SEBI. Two types: -Stock market -loans from banks and non-banks. For example: –Mutual Funds (Long term) -ICICI Bank
?
?
Organized Capital Market - Loans
?
Main source of financing for the firms that do not issue security. Cheapest form of finance.
Sources – Banks( and other institutes and lenders. Types – Secured And Unsecured
(Credit Card &Personal loan)
?
?
?
Organized Capital Market Stock Market
?
? ?
?
?
Place where shares are purchased and sold. Size $51 trillion Deals in long term securities (funds) from both private and government. Includes corporate securities and government securities. Example- Bombay Stock Exchange
Stock Market - Government securities
?
Instruments used for raising long term capital from the public. No risk involved in normal circumstances.
Example - Government bonds.
?
?
Stock Market -Corporate Securities
?
Instruments used for raising long term corporate capital from the public. Examples-issues of shares, debentures.
?
Corporate Securities -Primary Market
?
Part of corporate securities.
Also called as New Issues Market. Deals in issuing of new securities in the form of public issues, rights issues or private placements to raise the capital of corporate enterprise.
?
?
Corporate Securities -Secondary Market
?
Provides a market place for purchase and sale of old securities.
Provides liquidity to old stock for firm and investors. Example-Stock exchanges.
?
?
Types of Secondary Market
Organized security exchanges• • •
Tangible entities. Physically occupy space (such as a building or part of a building). Financial instruments are traded on their premises. over the counter marketsInformal market where negotiated deals take place.
?
•
DIFFERENCE BETWEEN PRIMARY & SECONDARY MARKET
?
In the primary market, securities are offered to public for subscription for the purpose of raising capital or fund.
For example -Reliance Power
?
Secondary market is an equity trading avenue in which already existing/preissued securities are traded amongst investors. For example -Reliance Petroleum -DLF
?
?
Stock Exchange
?
Centres for trading of securities Total 24 stock exchanges in India22 are regional stock exchanges 2 are primary stock exchanges
?
?
-National Stock Exchange -Bombay Stock Exchange
National Stock Exchange
?
Set up in June 1994. Provides fully automated screen-based trading system across the country. Has S&P NSE 50 Index( Nifty).
?
?
Bombay Stock Exchange
Established in1987.
BSE Index- BSE Sensex comprising of 30 stocks.
?
?
Facts about Indian capital Market
?
India’s capital market includes primary, secondary, Over the counter market.
Securities Board of Exchange(SEBI)Central regulatory authority and regulates capital markets in India.
?
THANK YOU
doc_577562116.ppt