CAPITAL MARKET: ITS PARTICIPANTS AND INSTUMENTS

Capital market participants

The primary issuers of capital market securities are federal and local governments and corporations

The federal government issues long-term notes and bonds to 37 fund the national debt

Capital markets are for securities with an original maturity that is greater than one year

Bonds

Stocks

Mortgages

Junk Bonds. Speculative-grade bonds are often called junk bonds

Conversion.Some bonds can be converted into shares of common stock

Municipal Bonds are securities issued by local country and state governments

Treasury Bonds.The U.S. Treasury issued notes and bonds to finance the national debt

Types of Bonds

Long-term government notes and bonds

Municipal Bonds

Corporate Bonds

Bearer Bonds

Registered Bonds

Capital Market Traiding

Capital market trading occurs in either the primary market or the secondary market

Investment funds, corporations and individual investors can all purchase securities offered in the primary market