(2) Government Securities Market :-
It is also known as Gilt-Edged securities market. It is a market where government securities are traded. Government securities may be short term and long term. Usually long term securities are traded in this market. Short term securities are traded in the money market.

(3) Long-term Loans Market :-
Development banks and commercial banks play an important role in this market by supplying long term loans to corporate houses. Long term loans market can be again classified into (a) Term loans (b) Mortgages and (c) Financial Guarantee markets.

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What is Secondary Market?

The shares and debentures which are already issued by the issuers are permitted to trade in the Secondary market. In this market, a share or bond/ debenture issue which is already sold to the public is traded between current and potential owners (existing owner and would be owner). The proceeds from a sale in the Secondary market do not go to the issuing organisation but to the current (existing) owner of the security.

The Secondary market involves trading of securities initially sold in the Primary market. Thus Secondary market provides liquidity to the individuals who acquired the securities via the Primary market.

What is Primary Market?

The main function of primary market is to facilitate the transfer of resources from savers to entrepreneurs or businessman seeking to establish new enterprise or to expand/diversify/modernise existing ones. The primary market deals with those securities which are issued to the public for the first time. Primary market is a market for new issues or new financial claims. That is why primary market is also known as new issues market. A company can raise capital via the primary market through three different ways – (a) Public issue (b) Right issue and (c) Private placement.

What is Industrial Securities Market?

The usual industrial securities like equity shares, preference shares and
debentures/bonds are dealt by the industrial securities market. Industrial
houses raise their capital or procure debt by issuing suitable instruments.
The industrial securities market may be further divided into two. They are

• Primary market or new issue market
• Secondary market or stock market or stock exchange

Types of Financial Markets

On the basis of credit requirement period, financial markets may be classified as
• Money market
• Capital market/Securities market

1) Money Market

Money market is a market where money is bought and sold. It is a market for
short term money and financial assets that are close substitutes for money. The
market does not have a place like the stock market or commodities market. The
activity of trading is mostly done through telephones.

2) Capital Market

The capital market is a market for financial assets which have a long maturity
period, usually above one year. Capital market may be further divided into three, namely
1) Industrial Securities Market
2) Government Securities Market
3) Long-term Loans Market

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What is Deposits?

Deposits are another important liquid financial asset. Deposits include all claims on the RBI(Reserve Bank of India) and other depository corporations, represented as bank deposit.