Question

What is the meaning of capital market?

Hint:

The capital market's purpose is to raise long-term capital, and it provides an essential financial platform for both investors and companies.

Answer 1

A capital market is a financial market where financial assets for long-term investments are bought and sold. The main purpose of the capital market is to raise capital for governments, companies, and other organizations. It is mainly divided into two segments: Step 1: Primary Market.
This is the market where new financial assets are issued for the first time. Companies and governments raise funds by selling their shares, bonds, and other financial instruments here.
Step 2: Secondary Market.
This is the market where previously issued financial assets are bought and sold. In this market, investors trade shares, bonds, etc., among themselves. The company does not directly benefit from transactions in this market, but it provides liquidity for investors.
Step 3: Importance of Capital Market.
The capital market is extremely important for economic development, as it provides companies with the opportunity to raise capital for expansion plans. Through it, investors are offered stable and profitable investment options.