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What is money market and what is capital market?

What is money market? What is capital markets? I know that money market deals with money supply in the market and consists of treasury bills and MFs and capital market consists of banks. But these are just examples. What is the meaning of money market and what is the meaning of capital markets.

Comments

  • edited 5:12PM
    Financial Markets of a country has two components:-
    1) Money Market
    2) Capital Markets


    Basically Money Market is the that part of the financial markets that deals with transaction of funds less than1 year - 364 days or less. It caters to short term need for funds.

    Capital Markets is that part of the financial markets that deals with the transaction of funds greater than 1 year - 365 days or more. It caters to long term need for funds.
  • edited 5:12PM
    thank you sir, can you guide where to read it from? also can you give some examples?
  • edited 5:12PM
    @nitin25 Reading any basic book of Economic like Misra & Puri will help. Try reading it once before you put such basic questions here as they are really really simple questions with no scope for any confusion!

    Example of Money Market Instruments - Certificate of Deposit, Call Money, Repo & Reverse Repo etc.

    Example of Capital Market Organisations - Banks, Financial Institutions, NBFCs etc.
  • edited 5:12PM
    I would suggest reading either TMH Economy or Dutta & Sundaram. While TMH Economy is great from Prelims point of view, Dutta & Sundaram (S Chand) is better from Mains point of view. I have read parts of it and some of the discussions are really subjective, detailed and very relevant from india's point of view.
  • KVAKVA
    edited 5:12PM
    sir, can u give example....?
  • edited 5:12PM
    abey chutiye...upar kya likha hai...example hi toh hai....theek se toh parh..
  • Arey Meri Falak ko unban kar do moderato bahut yaad aa rahi hai uski. O:-)
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