What is a capital and money market?
Capital and money markets are two distinct areas of the financial marketplace. Both markets offer individuals and businesses an outlet to raise money to support short- and long-term operations and investment.Capital MarketThe capital market trades long-term instruments such as stocks, mortgages, and corporate and government bonds. Long-term exposure to the markets means capital market instruments are more risky to hold.CharacteristicsCapital market instruments are long-term investments with a maturity of one year or more. In addition to stocks, the capital market includes long-term bonds. These instruments are traded in primary and secondary markets.Money MarketThe money market trades short-term debt securities with maturities of less than one year. Money market instruments provide short-term funding for businesses. Money market funds come from certificates of deposit, commercial paper and T-bills.CharateristicsMoney market instruments are traded frequently and are less susceptible to
