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Because the risks are less in money market. Because, there is less possibility of default of the credit of less than one year maturity. Likewise, the risk of interest rate is also low in the money market. On the other hand, the credit of the capital market is of long term nature. Due to this risks are more and are of varied nature in capital market.
What else can I help you with?
How can we differentiate between money and capital markets?
Money markets are where short-term debt securities are traded, typically with maturities of one year or less. Capital markets, on the other hand, deal with long-term securities like stocks and bonds with maturities exceeding one year.
Why capital markets are more developed in Kenya than money markets?
Central Bank has facilitated the development of these markets by providing a conducive atmosphere for setting up financial institutions which avail long finance on long term basis such as building societies and Mortgauge houses. Longterm finances available in the capital markets are relatively cheaper. There is less misuse of funds from capital markets as they are available in form of fixed assets Easy access as goodwill of the borrower may not be neccessary and securities may not be needed.
What are the instrument traded in money market or capital market?
Money Markets are the Markets where financial instruments with maturities of a year or less are traded. Examples of such securities are Treasury Bills, Commercial Paper and Short Term Certificates of Deposit. Capital Markets are the Markets on which financial instruments with maturities greater than one year are traded. Examples of Such securities are Treasury Notes, Treasury Bonds, Corporate Bonds and Equity (a.k.a. Stocks).
Is Tokyo a Less Economically Developed country?
Tokyo is not a country. Tokyo is the capital city of Japan. It is a very highly developed city. So it is not a Less Economically Developed Country.
how do you explain money and capital market?
Money markets are markets that are close substitutes for money. It is a market for overnight to short term funds and instruments having a maturity of one year or less than one year. It is not a physical location but an activity that is conducted over the phone. Such markets are characterised by a collection of markets for several instruments. Often the credit worthiness of the participant is relevant. It is a highly liquid market wherein securities are bought and sold in large denominations to reduce the transcation costs. example Treasury bills, call money market, CD's etc. Capital markets on the other hand is a market for long term securities whethre equity or debt, which aims to mobilise long term savings to finance long term investsments, provide risk capital in the form of equity. encourages broader ownership of productive assets. It is wider than money market and constitutes all form of lending and borrowing. It improves the efficiency of capital allocation through competitive pricing mechanism
What can help less developed countries do to affect domestic innovation?
Developing countries can benefit from an expansion in international trade markets.
What are the various types of financial markets?
Most known would probably be capital markets: Equity and bond markets. (private company stocks and lending to the government) Foreign exchange markets (currency exchange) Commodity markets (grain, oil, iron, copper, silver, gold, etc) Money market (lending and borrowing of cash) Less known and more complicated would be derivatives: Futures and options market (specific transactions rights to specific assets) Insurance markets (self explanatory)
What single characteristic separates more developed countries from less developed countries?
Good economy activity, And money (country income)
When was Pay Less Food Markets created?
Pay Less Food Markets was created in 1947.
Is Mexico more developed or less developed?
Less developed.
What are the factors that limit industrial development in less developed countries?
low capital accumulation lack of skilled labor lack of technology
What are the 2 main arguments favoring the expansion of us businesses into global markets?
Literacy rates worldwide increasing and life expectancy in less developed areas rising.
