Financial Markets

Financial markets are platforms or systems that facilitate the buying and selling of financial instruments, such as stocks, bonds, currencies, and derivatives. They serve as a conduit for the flow of money between savers and borrowers, enabling participants to raise capital, allocate resources, and manage risks. Financial markets can be classified into various segments, including primary markets, where securities are created and sold for the first time, and secondary markets, where existing securities are traded among investors. They can also be categorized by the type of instruments traded, such as equity markets for stocks, debt markets for bonds, and foreign exchange markets for currency trading. These markets play a crucial role in the economy by providing liquidity, price discovery, and capital formation, and are influenced by various factors, including economic indicators, interest rates, and political events.