Difference between Money Market and Capital Market
Financial market | Finance
BBA | BBA-BI |BBS | BHCM
Management Notes
Difference between Money Market and Capital Market:
Money market is one of the type of financial market where short term securities are traded.Capital market is one the type of financial market where long term securities are traded.
Money Market Vs Capital Market
| S.No. | Money Market | Capital Market |
| 1. | Money market is one of the type of financial market where short term securities are traded. | Capital market is one the type of financial market where long term securities are traded. |
| 2. | The securities traded in money market have life less than one year. | The securities traded in capital market have life more than one year. |
| 3. | The securities traded in money market are highly liquid (can be easily converted into cash) as they have maturity period less than one year. | The securities traded in capital market are less liquid (can be easily converted into cash) as they have maturity period more than one year. |
| 4. | The securities traded in money market are unsecured because they are issued without collateral(property or other asset that a borrower offers as a way for a lender to secure the loan.). | The securities traded in capital market are secured because they are issued with collateral(property or other asset that a borrower offers as a way for a lender to secure the loan.). |
| 5. | The money market instruments are Treasury bill, Commercial paper, bank deposit , Certificate of deposit(CD), etc. | The capital market instruments are Common stock ,Preferred Stock, bond, debentures, etc. |
Similarly,
You may like:
Read this also:
Functions of Financial Market – Finance | Management Notes- Difference between Organized Exchange Market and OTC market | Finance
- Difference between ROE (Return on Equity) and ROA (Return on Assets) – Finance | Management Notes
- Liquidity Ratios – Finance
- Determinants of Market Interest Rate – Finance | Management Notes
- Types of Lease – Lease Financing | Financial Management
