Question

What do you mean by Money market and how is it different from capital market?

Answer 1

$\huge\bold\green{Holla}$

♠▀▄▀▄▀▄capital market ▄▀▄▀▄▀

▶ᴛʜᴇ ᴘʟᴀᴄᴇ ᴡʜᴇʀᴇ ᴄᴏᴍᴘᴀɴɪᴇs, ɪɴᴅᴜsᴛʀɪᴇs ᴏʀ ᴇɴᴛɪᴛɪᴇs ʀᴀɪsᴇ ᴄᴀᴘɪᴛᴀʟ ᴀɴᴅ ɪɴᴠᴇsᴛᴏʀs ɪɴᴠᴇsᴛ ᴛʜᴇɪʀ sᴀᴠɪɴɢs ᴏʀ ᴄᴀᴘɪᴛᴀʟ ɪɴ ᴄᴏᴍᴘᴀɴɪᴇs ᴏʀ ɪɴᴅᴜsᴛʀɪᴇs. ᴄᴀsʜ ɪɴsᴛʀᴜᴍᴇɴᴛs ʟɪᴋᴇ,

sʜᴀʀᴇs,

ᴍᴜᴛᴜᴀʟ ғᴜɴᴅs,

ᴅᴇʀɪᴠᴀᴛɪᴠᴇ ɪɴsᴛʀᴜᴍᴇɴᴛs ᴇᴛᴄ. ᴀʀᴇ ᴛʀᴀᴅᴇᴅ ʜᴇʀᴇ.

◼ʀɪsᴋ:

ʀᴇʟᴀᴛɪᴠᴇʟʏ ʜɪɢʜ ʀɪsᴋ ɪɴsᴛʀᴜᴍᴇɴᴛs, ʙᴇᴄᴀᴜsᴇ ʏᴏᴜʀ ɪɴᴠᴇsᴛᴍᴇɴᴛ ᴄᴀɴ ᴢᴇʀᴏ ɪғ ᴄᴏᴍᴘᴀɴɪᴇs sᴛᴀʀᴛ ᴅᴏᴡɴ ᴘᴇʀғᴏʀᴍɪɴɢ.

◼ʀᴇᴛᴜʀɴs:

ʀᴇʟᴀᴛɪᴠᴇʟʏ ɢɪᴠᴇs ʜɪɢʜ ʀᴇᴛᴜʀɴs ᴛʜᴀɴ ᴏᴛʜᴇʀ ɪɴsᴛʀᴜᴍᴇɴᴛs ɪɴ ᴛʜᴇ ғᴏʀᴍ ᴏғ ᴅɪᴠɪᴅᴇɴᴅ ᴀɴᴅ ᴄᴀᴘɪᴛᴀʟ ᴀᴘᴘʀᴇᴄɪᴀᴛɪᴏɴ.....
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♠.•♫•♬•Ⓜⓞⓝⓔⓨ ⓜⓐⓡⓚⓔⓣ •♬•♫•.

▶.ɪᴛ ɪs ᴛʜᴇ ᴘʟᴀᴄᴇ ᴡʜᴇʀᴇ ʏᴏᴜ ғɪɴᴅ ʙᴜʏᴇʀs ᴀɴᴅ sᴇʟʟᴇʀs ᴏғ ғɪɴᴀɴᴄɪᴀʟ ɪɴsᴛʀᴜᴍᴇɴᴛs ᴄᴀʟʟᴇᴅ ᴅᴇʙᴛ ɪɴsᴛʀᴜᴍᴇɴᴛs. ɢᴏᴠᴇʀɴᴍᴇɴᴛs, ᴄᴏᴍᴘᴀɴɪᴇs, ɪɴᴅᴜsᴛʀɪᴇs ᴏʀ ᴇɴᴛɪᴛɪᴇs ᴡɪʟʟ ᴛᴀᴋᴇ sʜᴏʀᴛ ᴛᴇʀᴍ ᴅᴇʙᴛ ғʀᴏᴍ ᴘᴜʙʟɪᴄ ᴛᴏ ᴍᴇᴇᴛ ᴛʜᴇɪʀ ᴡᴏʀᴋɪɴɢ ᴄᴀᴘɪᴛᴀʟ ʀᴇǫᴜɪʀᴇᴍᴇɴᴛ ᴏʀ ɪɴғʀᴀsᴛʀᴜᴄᴛᴜʀᴇ ɴᴇᴇᴅ ᴇᴛᴄ.ᴇɢ:

ʙᴏɴᴅs,

ᴅᴇʙᴇɴᴛᴜʀᴇs,

ᴄᴇʀᴛɪғɪᴄᴀᴛᴇ ᴏғ ᴅᴇᴘᴏsɪᴛs,

ᴄᴏᴍᴍᴇʀᴄɪᴀʟ ᴘᴀᴘᴇʀs, ᴀʀᴇ ᴛʀᴀᴅᴇᴅ ʜᴇʀᴇ.

◼ʀɪsᴋ:

ʀᴇʟᴀᴛɪᴠᴇʟʏ ʟᴏᴡ ʀɪsᴋ, ᴀɴᴅ sᴀғᴇ ɪɴsᴛʀᴜᴍᴇɴᴛ.

◼ʀᴇᴛᴜʀɴs:

ʀᴇʟᴀᴛɪᴠᴇʟʏ ʟᴏᴡ ʀᴇᴛᴜʀɴs, ɪғ ғᴏʀᴍ ᴏғ ᴄᴏᴜᴘᴏɴ ʀᴀᴛᴇs, ɪɴᴛᴇʀᴇsᴛ ʀᴀᴛᴇ. ᴍᴀᴛᴜʀɪᴛʏ ᴘᴇʀɪᴏᴅ ɪs ᴛʜᴇɪʀ ғᴏʀ ᴀʟʟ ᴛʜᴇ ɪɴsᴛʀᴜᴍᴇɴᴛs.

ᴛʜᴇsᴇ ᴀʀᴇ ᴀʟᴛᴇʀɴᴀᴛɪᴠᴇ ɪɴᴠᴇsᴛᴍᴇɴᴛs ғᴏʀ ᴘᴜʙʟɪᴄ ғʀᴏᴍ ʜɪɢʜ ʀɪsᴋʏ ɪɴsᴛʀᴜᴍᴇɴᴛs ɪɴ ᴄᴀᴘɪᴛᴀʟ ᴍᴀʀᴋᴇᴛs.♠♠

✿.｡.:* ☆:**:.Thanks .:**:☆ *:.｡.✿

Answer 2

The money market is the place where various financial instruments and elements with short maturities and high liquidity are actually traded.

It is  always used by the participants as the means for lending and borrowing in a short term with some maturities which truly range from the overnight to simply below 12 months.