Discuss the features of capital market in India.
Answers
Features of Capital Market in India :
Following are the main features of the Capital Market :
1. Connects savers and entrepreneurial borrowers :
The capital market links savers with the borrowers of funds. It routes money from savers to entrepreneurial borrowers.
2. Deals is medium and long-term investments :
Capital Market is a market for medium and long-term financial instruments. It helps in raising long-term funds. Through this market, Corporates, industrial Organizations, financial institutions and so on get access to long-term funds from both domestic and foreign markets.
3. Presence of intermediaries :
Capital Market operates with the help of intermediaries like brokers, underwriters, Merchant bankers, sub-brokers, collection bankers and so on. These intermediaries are important elements of a capital market.
4. Determinant of rate of Capital formation :
Capital Market is a determinant of the rate of capital formation in an economy as it mobilizes funds. Capital Formation is the net addition to the existing stock of an economy's capital.
5. Capital Markets are regulated by government rules and regulations :
Capital Market operates freely. However, it is regulated by government rules, regulations and policies. For example, BSE and NSE are regulated by SEBI, a government body.
6. Deals in marketable and non.
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