In every economy, there are typically two types of financial markets; one is the capital market and the other is the money market. The function of both the markets is the same; both act as a link between the investors and the wealth creators. The fund gathered in this process is used to create wealth in the economy in the long run.
The former market deals in commodities and financial instruments in the form of long-term securities having a maturity of more than a year. A capital market is known for making the transactions between the investors and the companies smoother.
The money market is known for buying and selling securities that have short-term maturities, like less than a year, e.g. treasury bills and commercial papers.
Two types of capital markets
Let’s take a look at the two major types of capital markets:
- Primary market – It is the most important type of capital market. Its key function is the formation of capital for the government, institutions, companies, etc. It aids investors in investing their savings and extra funds in companies that plan to start new projects or enterprises expanding their companies.
- Secondary market - This is commonly known as the stock market. Here, the investors indulge in buying and selling securities in the form of debentures, shares, bills, bonds, etc.
The basic difference between the two markets is that the primary market issues only new securities whereas the secondary market deals with existing securities. No fresh issues are made in the secondary market.
Career opportunities in the capital market
When we talk of the capital market, there are unlimited rewarding career opportunities for individuals from different backgrounds, irrespective of age, gender, educational qualification to a certain level and area of interest. Also, liberalization in the Indian economy gives rise to opportunities in the capital markets for both national and international players. So, considering all these aspects, we can conclude that there are strong choices of a career in the capital market for people who want to pursue a future in this field.
Some of the sector-wise positions in the capital market are:
- Commercial Banking
- Credit Analysis
- Real Estate
- Portfolio Management
- Risk Management
- Government Contracting
- Government Contract Analysis
- Government Acquisition
Few popular certification courses on capital market
In order to build a successful career in capital marketing, one can pick the most suitable capital market course from the list below:
- Currency and interest rate derivatives – This unique industry-recognized certification course helps to boost one’s career with valuable practitioner visions.
- Exchange-traded derivatives – If our target is the financial services, then this course can give a great shape to a career with its practical knowledge on currency futures and options.
- Financial markets AML compliance - This program is basically based on AML (Anti Money Laundering) standards delivered by the regulatory bodies.
- FLIP - NCFM: Capital Markets Fundamentals International – This is India’s only online course on the US, UK Financial Markets that can help you acquire a FLIP NCFM certification. It works best for IT and KPO professionals.
The capital market is basically a branch of finance and anyone having an interest in this field can consider taking up a career by opting for the right course. Like most other professions, even a career in the capital market requires a certain skill set together with some basic attributes. Since capital markets deal with several activities associated with both the investors and the borrowers, the career scopes are also very diverse.