Financial Markets

Financial markets refer to platforms or systems that facilitate the buying and selling of financial instruments, such as stocks, bonds, currencies, and derivatives. These markets enable participants—such as investors, institutions, and governments—to raise capital, manage risk, and allocate resources efficiently. Financial markets can be classified into various types, including primary markets, where new issues of securities are sold, and secondary markets, where existing securities are traded. They also encompass various sectors, including stock markets, bond markets, forex (foreign exchange) markets, and commodity markets. The functioning of financial markets is crucial for the overall economy, as they influence interest rates, economic growth, and investment strategies. Market efficiency, liquidity, and regulation are key characteristics that affect their operation and the behavior of investors.