Financial Market- Basic Information For The Beginners
Market refers to the group of places where certain services or goods can be exchanged for money. Today there are different kinds of markets that range from grocery shops to real estate market. The financial market is the place where the different kinds of financial instruments get traded. This market is classified into different categories based on the different types of assets or goods that are traded. The most popular markets are bond market, equity market, currency market and commodity market.
Types of financial markets
Equity market- The companies sell their shares to raise the capital and the equity market is the place where these shares get traded. Traders buy the shares in hope that its value will go up and they sell it on a later date, thus earning the profit. There are traders who sell the shares at the high price and then buy back again when the price goes down. The stock market trends are influenced by many factors like economic reforms, political news, business acquisitions, etc. You need to keep analyzing the trade reports and be updated with all the things happening around the world to take a wise decision.
Currency market- This market is also called as foreign exchange market, wherein the governments or companies that wish to settle their loans or debts in another country’s currency can get that currency. Even there are speculative traders in this who earn a profit by buying a particular currency at a low rate and then selling it on a higher rate.
There’s a new market known as cryptocurrency market has come into existence. It is gaining wide popularity nowadays among the traders because of the ease in which in they help in earning big money quickly. There are many automated trading software like crypto VIP club which assists the people to conduct the trading of cryptocurrencies. Learn more about it here.
Commodity market- This market is comprised of promises and contracts to sell or buy the goods like oil, wheat or gold at a particular price on a given day. Earlier days, the farmers sold their good in this market as they had the security that the products will be sold at a particular price even when the market is not performing well. Now there are many traders who take part in the market without any intention of actually using the crops, but they are a part of the market solely for the purpose to earn profit through the trading.