In contrast to the money market with a short- term maturity, which is less than one year, the capital market gives investors the possibility to buy and sell intermediate-term and long- term securities with maturities over one year. It conduces to investors, which could be companies, governments and households, to finance investments and other transactions.
In the capital market the investors can borrow money for market transaction, e.g. for buying real estate, because in these transactions larger sums of money are required.
The investors can invest in stocks, bonds, mutual funds, exchange traded funds, mortgage loans, deed trusts, options, and futures.
In real estate transactions they invest usually in bonds, stocks, mortgage loans and deed trusts.
Bonds e.g. are, as mentioned above, long- term debt instruments from which the investors get periodic interest payments and stocks represent an ownership in a company and are an equity investment, which has a fixed dividend rate.
The capital market can be divided in two parts, the primary and the secondary market. In the primary market new securities are issued from companies and are sold to the investors. In the secondary market you can sell to and buy the securities from other investors, which are already in the market.
There exists a capital market risk, because of the long-term investment the investors could suffer from there investments, if there occurs another better investment and they cannot get out (fast enough) of their investment they are involved.
In the capital market the investors can borrow money for market transaction, e.g. for buying real estate, because in these transactions larger sums of money are required.
The investors can invest in stocks, bonds, mutual funds, exchange traded funds, mortgage loans, deed trusts, options, and futures.
In real estate transactions they invest usually in bonds, stocks, mortgage loans and deed trusts.
Bonds e.g. are, as mentioned above, long- term debt instruments from which the investors get periodic interest payments and stocks represent an ownership in a company and are an equity investment, which has a fixed dividend rate.
The capital market can be divided in two parts, the primary and the secondary market. In the primary market new securities are issued from companies and are sold to the investors. In the secondary market you can sell to and buy the securities from other investors, which are already in the market.
There exists a capital market risk, because of the long-term investment the investors could suffer from there investments, if there occurs another better investment and they cannot get out (fast enough) of their investment they are involved.
Rattermann, M. R. (2009). The Student Handbook to The Appraisal of Real Estate. Chicago, IL: Appraisal Institute, 13th edition
Lawrence J. Gitman, Michael D. Joehnk, Scott B. Smart (2010), Fundamentals of investing, Boston, MA, 11th edition,
Robert Parrino, David Kidwell (2009), Fundamentals of Corporate Finance, Danvers, MA
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