What is Capital market?

A market where the trade of financial securities like bonds, stocks etc. take place between buyers and sellers is known as Capital market. The participants of the trade can be either institutions, companies or private individuals. Usually, long-term securities are traded in it. The capital market is comprised of primary and secondary markets. Primary markets are the ones which deal in trading of new securities and stocks while the secondary markets are the ones which are involved in trading of previously-held securities.

Capital market can also be divided based on the nature of the security traded i.e. a stock market or a bond market.