The Capital Markets

Capital markets are financial markets where long-term debt or equity securities are bought and sold. They enable businesses, governments, and other organizations to raise funds by issuing stocks (ownership) or bonds (loans). Investors purchase these securities to earn returns, either through dividends or interest payments. Capital markets are essential for economic growth as they provide the necessary funding for investments in infrastructure, innovation, and expansion. They include primary markets, where new securities are issued, and secondary markets, where existing securities are traded among investors. Essentially, they facilitate the flow of money in the economy.