Spot Markets
the markets in which assets are bought or sold for "on-the-spot" delivery
Futures Markets
the markets in which participants agree today to buy or sell an asset at some future date
Money Markets
the financial markets in which funds are borrowed or loaned for short periods (less than one year)
Capital Markets
the financial markets for stocks and for intermediate or long-term debt (one year or longer)
Primary Markets
markets in which corporations raise capital by issuing new securities
Secondary Markets
markets in which securities and other financial assets are traded among investors after they have been issued by corporations
Private Markets
markets in which transactions are worked out directly between two parties
Public Markets
markets in which standardized contracts are traded on organized exchanges
Derivative
any financial asset whose value is derived from the value of some other "underlying" asset
Investment Bank
an organization that underwrites and distributes new investment securities and helps businesses obtain financing
Commercial Bank
the traditional department store of finance serving a variety of savers and borrowers
Financial Services Corporation
a firm that offers a wide range of financial services, including investment banking, brokerage operations, insurance, and commercial banking
Mutual Funds
organizations that pool investor funds to purchase financial instruments and thus reduce risks through diversification
Money market funds
mutual funds that invest in short-term, low-risk securities and allow investors to write checks against their accounts
Physical location exchanges
formal organizations having tangible physical locations that conduct auction markets in designated ("listed") securities
Over-the-counter (OTC) Market
a large collection of brokers and dealers, connected electronically by telephones and computers, that provides for trading in unlisted securities
Dealer Market
includes all facilities that are needed to conduct security transactions not conducted on the physical location exchanges
Closely Held Corporation
a corporation that is owned by a few individuals who are typically associated with the firm's management
Publicly Owned Corporation
a corporation that is owned by a relatively large number of individuals who are not actively involved in the firm's management
Going Public
the act of selling stock to the public at large by a closely held corporation or its principal stockholders
Initial Public Offering (IPO) Market
the market for stocks of companies that are in the process of going public
Efficient Markets Hypothesis
remains one of the cornerstones of modern finance theory - implies that, on average, asset prices are about equal to their intrinsic values