What is the difference between a financial market and a capital market

What is the difference between a financial market and a capital market Introduction: The World of Markets Welcome to this informative video that aims to demystify the differences between financial markets and capital markets. In today's interconnected world, these markets play a pivotal role in shaping our economies and influencing investment decisions. So, let's dive in! Defining Financial Markets Financial markets serve as a platform for the buying and selling of various financial instruments. These can range from stocks and bonds to derivatives and commodities. The primary objective of a financial market is to facilitate the flow of capital between borrowers and lenders. It's a dynamic ecosystem where investors can find opportunities to grow their wealth, and businesses can secure funding for their ventures. Understanding Capital Markets Capital markets, on the other hand, are a subset of financial markets. They specifically deal with long-term investments, typically exceeding one year. In a capital market, entities such as governments, corporations, and municipalities raise funds by issuing securities like stocks and bonds. These securities, in turn, are traded among investors. Capital markets are crucial for fostering economic growth, as they enable businesses to access the necessary capital for expansion and innovation.