Vincent Konadu Tawiah

ROLE OF CAPITAL MARKET

2014
5/15/2018 role of capital market by Vincent & Vasanth 1
 INTRODUCTION

 Financial market
 Types of financial market
 Forex market
 Capital market
 Money market
 Credit market
 Derivative market

5/15/2018 role of capital market by Vincent & Vasanth 2

 CAPITAL MARKET
 Is a financial market where investment instruments
like bonds and equities are bought and sold.

 Capital market primary role is to connect investors

who have surplus funds to companies who are running
deficit or need the funds

5/15/2018 role of capital market by Vincent & Vasanth 3

 TYPES CAPITAL MARKET

5/15/2018 role of capital market by Vincent & Vasanth 4

 PRIMARY MARKET
Capital instrument such as shares and bond are sold to
the public for the first time. (IPO)

Is mainly concerned with new issues so is a called NEW

ISSUE MARKET

5/15/2018 role of capital market by Vincent & Vasanth 5

 SECONDARY MARKET
Is that market in which the buying and selling of the
previously issued securities is done

It create liquidity in securities.

Also called stock exchange market

5/15/2018 role of capital market by Vincent & Vasanth 6

PLAYERS OF CAPITAL MARKET
 INVESTORS: usually individuals or group of people
who buy or invest their surplus fund

 COMPANIES OR INDUSTRIES; they seek surplus fund

from investors

 ECONOMY/ GOVERNMENT; referee or regulator of

the market

5/15/2018 role of capital market by Vincent & Vasanth 7

 WHAT IS TRADED
 Equity instruments

 Insurance instruments

 Bond instruments

 Hybrid instrument

5/15/2018 role of capital market by Vincent & Vasanth 8

ROLE OF CAPITAL MARKET
INVESTORS
 Reduction in risk through diversification;
various platform for investment

 Liquidity; easy to convert investment to cash

 Information dissemination

5/15/2018 role of capital market by Vincent & Vasanth 9

 COMPANY OR INDUSTRY
 Source of finance

 Continuous availability of fund

 Measure of performance

5/15/2018 role of capital market by Vincent & Vasanth 10

 ECONOMY
 Mobilization of savings

 Capital formation

 Allocation of resources among companies

 Collection of information; SENSEX NIFTY index

5/15/2018 role of capital market by Vincent & Vasanth 11

 WRAP UP
 A country with strong capital market like our INDIA will

continue to experience high growth in industrialization

through effective capital formation which will eventually

result in speedy economic growth and development.

5/15/2018 role of capital market by Vincent & Vasanth 12

5/15/2018 role of capital market by Vincent & Vasanth 13
 REFERENCE
 www.slideshare.net/tejasvibhosale/capital-market-ppt
 www.authorstream/presentation
 www.iepf.gov.in/IEPF/Role.html

5/15/2018 role of capital market by Vincent & Vasanth 14