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  1. 1. Jaswinder Kaur 1
  2. 2. NAME Rizwan Shaikh Nirav Bhatt Dharmesh Gupta 2
  3. 3. Financial markets consist of two major types : 1.Money market : Money market is a market for debt securities that pay off in the short term usually less than a year. 2.Capital market : Capital market is a market for long term debt and equity shares. 3
  4. 4. CAPITAL MARKET CONSIST OF TWO MARKETS  Primary and secondary  Primary Market: The primary market is that part of the capital markets that deals with the issuance of new securities. Companies, governments or public sector institutions can obtain bonds through the sale of a new stock or bond issue. This is typically done through a syndicate of securities dealers 4
  5. 5.  Secondary Market refers to a market where securities are traded after being initially offered to the public in the primary market and/or listed on the Stock Exchange.  Majority of the trading is done in the secondary market. Secondary market comprises of equity markets and the debt markets. 5
  6. 6. primary market     In primary markets, securities are bought by way of public issue directly from the company. New issue are available in primary market. The primary is a middlemen. New issue of common stock;bonds and preferred stock are sold by companies. secondary market     In Secondary market share are traded between two investors. Securities usually bought and sold through the secondary market. The secondary market are broker and dealer. The secondary market stock and bonds issues are sold to the public. 6
  7. 7.  Secondary Market has an important role to play behind the developments of an efficient capital market.  Secondary market connects investors' favoritism for liquidity with the capital users' wish of using their capital for a longer period.  Secondary market is that financial market in which investor can buy and sell shares and bonds after its issue by company. 7
  8. 8. 1.Exchange 2.Over the counter 3.Capital gain 4.Liquidity 8
  9. 9.     Advantages Secondary markets offer advantages to both sellers and buyers. Sellers gain the advantage of effectively reducing the purchase price of products and investments by recouping a portion of what they originally paid. Disadvantages If secondary markets grow too large, they can eat into original sellers' sales and profit margins. Especially in the case of long-lasting goods such as automobiles and musical instruments, secondary markets can encourage a large percentage of shoppers to purchase used items rather than purchasing new. 9
  10. 10. PRODUCTS AVAILABLE IN THE SECONDARY MARKET Equity Shares Government securities Debentures Bond Commercial Paper 10
  11. 11.  Who is a broker?  Who is a sub broker? 11
  12. 12. AUCTION • The Exchange purchases the requisite quantity in the Auction Market and gives them to the buying trading member. • If the shares could not be bought in the auction i.e. if shares are not offered for sale in the auction, the transactions are closed out as per SEBI guidelines. 12
  13. 13.  Step 1. Investor / trader decides to trade  Step 2. Places order with a broker to buy / sell the required quantity of respective securities  Step 3. Best priced order matches based on price-time priority  Step 4. Order execution is electronically communicated to the broker’s terminal 13
  14. 14.  Step 5. Trade confirmation slip issued to the investor / trader by the broker  Step 6. Within 24 hours of trade execution, contract note is issued to the investor / trader by the broker  Step 7. T+2 day Pay-in of funds and securities before  Step 8. day Pay-out of funds and securities on T+2 14
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