Basic capital market concepts pdf

Corporate finance is the area of finance that deals with the capital structure of the business via the equity capital and debt capital. Despite this markets overwhelming size, when it comes to trading currencies, the concepts are simple. Capital markets help channelize surplus funds from savers to institutions which then invest them into productive use. Getting ready to invest, including goal setting and understanding the impact of cost and risk. It is important to maximize the firms value, while minimizing the cost of capital. Basic banking concepts free download as powerpoint presentation. Scarcity is the condition in which our wants are greater than our limited resources. Capital market concepts explained bear a shortterm speculator who would sell shares on account in the hope that they would fall in value so that they could be bought at the end of the account more cheaply leaving the investor with a profit at the end of settlement day.

Understanding the basics of investment in capital markets is considered the first step to achieve the investors financial goals. Capital is the term used for the items that are used to create a good or service. May 26, 2019 capital markets are markets for buying and selling equity and debt instruments. Introduction the concept of capital market efficiency can be said to be a research topic that has bring a lot of. The cost of capital is determined by computing the costs of various financing sources and weighing them proportionately, in balance, to their designated use in the capital structure. A market economy answers these questions by allowing the buyers and the producers of goods and services to come to an agreement regarding what is provided and bought. Learning objectives define marketing in official and real world terms list at least five viable market segments differentiate by example between services and. Capital markets help channelise surplus funds from savers to institutions which then invest them into productive use. Bloomberg market concepts bloomberg professional services. You can lose money because of the downs in the market, but you can also make money on the ups. Having access to one of the worlds deepest pools of capital and a varied investor base is vital. Investment fundamentals aims to demystify the process of using money to make money and give you a basic introduction to the key investment topics. Ensuring a orderly, fair and equitable market place by protecting the integrity of the market and investors from market manipulation providing a medium of exchange for retail and institutional investors to build and preserve wealth, while maintaining a robust investor protection fund nse function in the capital market 19.

We hope that after reading this, some of the hifinance terminology will become somewhat demystified. Capital market are financial markets for the buying and selling of longterm debt or equitybacked securities. It gives a basic understanding of capital market instruments like equity, debt, currencies, derivatives, financial planning and. The capital market has two interdependent and inseparable segments, the primary market and stock s econdary market. We should emphasize, however, that investing isnt a getrichquick scheme. Bmc consists of 4 modules economics, currencies, fixed income and equities woven together from. It, capital market, forms a large part of the system that runs an economy. Basic concepts open and closed economies a closed economy is one that does not interact with other economies in the world. Investment fundamentals an introduction to the basic concepts.

A market order is an order to buy or sell a stock at the best available price. Foreword adult basic education, the organisations are working together to help tackle financial literacy and to address the issue of access to financial products and services for those with literacy and numeracy difficulties. Japanese firms in general aim at building market share rather than early profits. Capital market is a market where buyers and sellers engage in trade of financial securities like bonds, stocks, etc. Basic concepts of economics in simple language clear ias. Jun 01, 2014 in this course you will learn all aspects of capital markets shares, stocks, dividends, ipo, bonds, mutual funds, stock exchange, index, demat etc.

A broad and diversified investor base provides a source of stable demand that supports liquidity, depth and stability. Over the last few decades, the average persons interest in the stock market has grown exponentially. Pdf on mar 4, 2019, prachi bhagat and others published financial marketsbasic concepts find, read and cite all the research you need on researchgate. The act of committing money or capital to an endeavor with the expectation of. Sometimes companies price the product very low with certain specific objectives like market penetration, using price as a strategic marketing variable to achieve the firms objective. The basic concepts of the theory are the efficient frontier, capital asset pricing model and beta coefficient, the capital market line and the securities market line. The investor needs to know that there are no guarantees for profit in investing. Types of capital market there are two types of capital market. Hence it is necessary to study its correct meaning. It means companies benefit from an established and reliable.

Awareness on investment mechanisms makes the investor avoid falling into the risks and enable himher to choose the best investment decisions. In primary market supranational, federal government, state government and companies raise capital by selling newly issued securities to buyers. An open economy interacts with other countries in two ways. Financial systems and financial markets, money markets and. The given video is presented to you by ecoaching india in collaboration with pioneer academy, new delhi.

Capital markets channel savings and investment between suppliers of capital such as. The basic building blocks of finance theory lay the foundation for many modern tools used in areas such asset pricing and investment. Capital market finance, economics, general studies, ssc. Consequently, the value of the invested capital is prone to decrease as it is subject to. Sometimes low price is the result of predatory pricing strategy.

An efficient capital market can provide a mechanism for raising capital and also by protecting investors in corporate securities4. Broadly speaking the capital market is a market for financial assets which have. Capital market is one of the significant aspect of every financial market. Capital market finance, economics, general studies. The icm fundamentals of capital markets certification exam cover the basic concepts of financial markets, types of assets and contracts, financial intermediaries. This demand coupled with advances in trading technology has opened up the markets so that nowadays nearly anybody can own stocks. Primary capital market a market where new securities are bought and sold for the first time.

The buyingselling is undertaken by participants such as individuals and institutions. Nov 28, 2012 the concept of capital market efficiency can be said to be a research topic that has bring a lot of arguments and suggestions on the field of finance as a course of study. Broadly speaking the capital market is a market for financial assets which have a long or indefinite maturity. Capital market is also known as stock market in india. Capital market includes financial instruments with more. While the stock market is an extremely complex system, its. You may be wearing clothing made in china or eating fruit from chile. An open economy is one that interacts freely with other economies around the world. The two most common order types are the market order and the limit order. Capital markets channel savings and investment between suppliers of capital such as retail investors and. Basic concepts in daily life, we nd ourselves in constant contact with internationally traded goods. In relation to the capital markets, our concern is with understanding the risk and.

While the stock market is an extremely complex system, its basic traits are much more simple. Secondary market comprises of equity markets and the debt markets. The securities and exchange board of india sebi, along with the reserve bank of india are the two regulatory authority for indian securities market, to protect investors and improve the microstructure of capital markets in india. Mickey smith, rph, phd director, center for pharmaceutical marketing and management university of mississippi. Mar 19, 2020 despite this markets overwhelming size, when it comes to trading currencies, the concepts are simple. Wb sum of all the market cap of all the scrips in the index during the base year. This conceptual framework sets out the basic concepts and definitions behind sasbs sustainability accounting standards the sasb standards and serves as additional guidance for the adoption of the. Financial theories and strategies introduction financial theories are the building blocks of todays corporate world. Taking control of your personal finances will take work, and, yes, there will be a learning curve. Whether you make or lose money in the market depends on how your investments perform. The capital market deals in ordinary stock are shares and debentures of corporations, and bonds and securities of governments. This course focuses on creating a powerful insight into the various tools and techniques required to understand the size, structure and functions of capital markets. Financial theories and strategies 1533 words 123 help me. The main areas covered are national income, monetary policy.

This paper looks into the concepts underpinning the current generation of capital market integration directives, that follow the lamfalussyapproach. Since we are unable to have everything we desire, we must make choices on how we will use our resources. After finished this book, the reader should be able to understand these basic concepts in order to apply them in vary field of finance. Sep 23, 2010 concept and meaning of capital market.

The capital market is a market which deals in longterm loans. As such, it would only be expected that the wider implications of market efficiency would also be just as farreaching. In this market, the capital funds comprising of both equity and debt are issued and traded. Over the last few decades, the average persons interest in the stock market has. Pioneer academy is a premier institute of india for bank and ssc, with a prime focus to. Basics of capital market investing this booklet is intended for those who are not familiar with the intricacies of investing in the capital markets. Certification in online foundation of capital market is designed for freshers and graduating students who would like to get introduced to the basic market terminologies and concepts. The basic concepts and features of bank liquidity and its risk. Each capital structure components cost is closely related to the valuation of. Investment fundamentals an introduction to the basic. Scribd is the worlds largest social reading and publishing site. There are no exports, no imports, and no capital flows. Capital markets are markets for buying and selling equity and debt instruments. Bloomberg market concepts bmc is a 10hour, selfpaced elearning course that provides an interactive introduction to the financial markets.

It involves applying corporate finance basic tools and methodologies to allocate the financial capital and maximize the value to the firm. This az pocket guide to understanding financial terms is just one of the achievements of ebss partnership with nala. Fundamentals of capital markets certification ifmp. This is a practice of temporarily selling at prices below cost with the. Because something is limited, we need to make decisions regarding how we use and allocate our resources. What was once a toy of the rich has now turned into the vehicle of choice for growing wealth. Lets take a look at some of the basic concepts that all forex investors need to understand. Mpt models the return of an asset as a random variable and a portfolio as a weighted combination of assets. Market research the most effective way to for pharmacists to find out the needs and attitudes of patients and thus effectively market their services self test figure 2. Basic investment concepts new york state attorney general. May 20, 2017 the given video is presented to you by ecoaching india in collaboration with pioneer academy, new delhi. But if the concepts are properly understood economics is fun. Foundation of capital markets the capital market basics. Economics is the study of scarcity and choice scarcity means that there is a finite amount of a good or service basically they are limited.

This course benefits new investors, retail traders, and financial service professionals by enhancing their existing knowledge base. Lets take a look at some of the basic concepts that. Before we start, we need to have an appropriate vocabulary of nancial terms. It supplies industry with fixed and working capital and finances mediumterm and longterm borrowings of the central, state and local governments. Economics is a tough nut to crack for many gdp, gnp, ndp, nnp, repo, reverse repo, slr, clr, crar there are many concepts to be understood. In this course you will learn all aspects of capital markets shares, stocks, dividends, ipo, bonds, mutual funds, stock exchange, index, demat etc. The basic concepts and features of bank liquidity and its risk sekoni, abiola. Vital information for the people you serve or want to serve. What you know and dont know about marketing patient survey form figure 3. What are the major sectors of the hk financial market. The stock market is a mechanism in which the shares of publicly traded companies are issued, bought and sold. This is the market place where financial investments normally of a longterm nature. Right price depends upon factors like nature of the market, costs, competition, buyers purchasing power, foreign exchange fluctuations etc. Over the long term, common stock, by means of capital growth, yields higher.

Study material for capital market examination1 cme1 of. As chartered accountants, we require a basic understanding of the capital market and its constituents to further develop expertise in the field. Capital market is a market for longterm debt and equity shares. Understanding the basic concept of the stock market is a first step in becoming an informed investor. The importance of asset allocation and the different asset classes. This concept is no more prevalent, but the word stock continues. But the rewards will far outweigh the required effort.