Wednesday, July 18, 2012

Money Market Vs. Capital Market

Money Market is the Financial Market in which funds are borrowed or loaned for short period of time normally less than a year.


SN
Money Market
Capital Market
         a
The financial market in which funds are borrowed or loaned for short periods less than one year.
The financial markets in which funds are borrowed or loaned for long term periods more than one year
         b
The instrument of money markets are highly liquid market as securities ie bill of exchange, commercial paper, certificate of deposit and treasury bills(T-Bills)
The instruments of capital markets are less liquid marketable securities ie. Share, debentures or bonds
         c
The commercial bank is a focus of the money market
The commercial bank purchase the securities of the stock market as investment
         d
Treasury bills are trade in money market
Treasury bonds are trade in capital market.

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