Financial markets

is a market mechanism that allows for one or koporasi to easily be able to close the sale and purchase in the form of financial securities (such as stocks and bonds), commodities in the securities it is possible to make a purchase and sale early in the products of natural resources such as agricultural products and Mining and others.

In the financial world, financial markets include:

* Sellers memperolehkan shares in the capital through the capital market;
* The transfer of risk in the derivatives market transactions; and
* International trade through foreign exchange market.
Financial markets may mean:

1. A market system that facilitate trafficking between the products and financial derivatives such as stock exchanges which facilitate trading in shares, bonds and warrants.
2. Meetings between buyers and sellers to trade financial products in a variety of ways including the use of stock exchanges, directly between sellers and buyers (over-the-counter).

In the academic world, students of financial subjects will use both meanings but students use only the economy of the second meaning.

The types of financial markets

Financial markets can be divided into several sub-types such as:

* Capital markets which consist of primary market and secondary markets are divided into:
o the stock market, which is a means of financing through the issuance of shares, and is a means of trading shares.
o bond markets, which is a means of financing through the issuance of bonds and bond trading facilities.
* Commodity markets, which facilitate the trading of commodities.
* Financial markets, which is a means of short-term debt financing and investment.
* Derivatives market, which is a facility that provides instruments to manage financial risk.
o futures market, which is a facility that provides trading futures contracts for a product at a future date.
* Insurance market, which facilitate the redistribution of various risks.
* Foreign exchange markets, which facilitate foreign exchange trading.

Benefits of financial markets

Without the financial markets is the money lenders (creditors) will have difficulty in finding debtors who are willing to lend him. Mediator such as a bank to help in this process, where the bank accepts deposits from customers who have the money to be saved and then the bank can lend money to people who intend to borrow money. Banks typically make loans of money in the form of loans and mortgages.

Illustration in the table below may explain the relationship between financial markets and borrowers and lenders:
The relationship between borrowers and lenders
Financial Intermediary Lenders Borrowers financial markets
Individual
Banks Companies
Insurance Company
Pensions
Mutual Funds
Interbank
Stock exchange
Financial markets
Bond market
Individual foreign exchange
Company
Central government
Pemerinmtah regions
Public Companies