Yamarkets 2022-01-14

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The Financial market serves as a place for buyers and sellers to trade assets like the stock market, Bond markets, money markets, Forex markets, Cryptocurrency markets, derivatives markets, and Commodities markets. These instruments help to earn money for the investors, companies, and traders. The financial market makes it easy for traders to expand their profits and create liquidity for the investors.

The Explanation of important assets are

          1. Stock market or Equity market

The companies issuing their shares for expanding their business, those shares are sold and bought by the traders thus is known as the stock exchange. It is a huge market where it played an important role in contributing to economic growth. It also provides capital gains and income sources for investors. This market is also considered as Equity market. The stock market is divided into two elements like buyer and seller. Buyers are intended to look for a low price because they can later earn profit however sellers are only motive to look for the best price. That’s how the stock market works in the first phase.

          2. Bond market

The bond market is also a marketplace where traders trade debt securities like government bonds, corporate bonds are known as the bond market. It is larger than the stock market where government and corporate use bonds to borrow money to raise funds; with this corporate want to expand their business and government need to be raise funds for developments in the society, it is also called bond issue. In this market, there are two categories like primary and secondary. Primary market refers to the transactions between the bond issuers and bond buyers however in the secondary market sold debt securities in primary where later investors purchase the bond from a broker who helps to trade selling and buying between the parties.

          3. Forex market

Forex is the largest market in the world. It presents that the currencies are exchanged through buying and selling one currency from one country to another. This market depends on currencies that market value constantly fluctuations according to the economy of the country. It means that depends on the performance of countries economy, if the economy performs well then the value of the currency will increase if it performs badly then the value of the currency will decrease. That’s how the market works in the world. The major currencies are EUR/USD. USD/JPY, GBP/USD, USD/CHF

          4. Cryptocurrency

Cryptocurrency is the digital currency for trading, buying, and purchasing goods, the first digital currency is bitcoin was invented in 2008 by Satoshi Nakamoto where all cryptocurrencies are based on blockchain technology. It is used to keep the transactions in the thousands of computers in the world which are linked for displaying ledger and all linked together through the network of computers called blockchain technology. The major cryptocurrency is Bitcoin, Dash, EOS, Ethereum, Litecoin, NEO, and Ripple. Trading cryptocurrencies is all about the movement of prices which buying and selling through exchanges.

         5. Derivatives markets

Derivatives markets refer to the financial instrument which contracts between the two parties trading from some specific group of assets. The important type of derivatives is futures, options, forwards, and swaps. It consists of financial security which is based on the value of the underlying assets and it keeps continuously changing. These are used to trading on exchanges and purchase through brokers.

          6. Commodities markets

Commodities markets are all about trading raw materials like Gold, metal, oil, wheat, and natural gas. Trading in the commodities market involves selling and buying commodities products by using future contracts for earning profits. There are two categories in the commodities market, the first one is hard and the second one is soft. Hard commodities include natural resources like gold and oil. And soft commodities are livestock products like sugar beans coffee etc. These goods of value change according to the growth of the economy.

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