What is meant by securities market? What is the function of securities market?
Answers
Explanation:
A securities market is a system of interconnection between all participants (professional and nonprofessional) that provides effective conditions: to attract new capital by means of issuing new security (securitization of debt) to transfer real asset into financial asset.
The three basic functions of securities markets are capital formation, liquidity, and risk management. These markets pair the companies that need capital to function, and the investors with capital that are looking for a return on their investments.
Securities are financial instruments issued to raise funds. The primary function of the securities markets is to enable to flow of capital from those that have it to those that need it. Securities market help in transfer of resources from those with idle resources to others who have a productive need for them.