Whether you have just started your career or getting retired soon, financial planning is an important aspect of stable adult life. The sooner you start investing and saving, the better returns you get and have a great life ahead. In the recent times, major populations have started investing and saving for their future and have done major financial planning. Financial markets are one of the best avenues to earn higher incomes and stabilize your future.
With proper understanding of the capital markets, you can optimize your investing, invest in the right stocks, and minimize your risks. Therefore, this article covers an overview of the financial markets and features the best course to skyrocket your financial planning journey.
An overview of Financial Markets
Financial markets are marketplaces where activities such as creating and trading various financial assets like shares, commodities, bonds, derivatives, and currencies occur. It is a platform for sellers and buyer to meet and trade at a price determined by the market forces.
In a financial market, money is lent directly to companies and interest and returns are gained. The market is characterised by large proportions of transactions and the speed by which one resource is moved from one owner to the other. They perform the crucial functions of an efficient payment mechanism, enhancing liquidity of financial claims, providing information about companies, diversification and reduction of risk, transmutation of financial claims for suiting the preferences of savers and borrowers, and an efficient avenue for capital generation and investment.
Depending upon the economy, millions of dollars are daily traded. The chief stock exchanges of India include National Stock Exchange (NSE) and Bombay Stock Exchange (BSE). These two exchanges have thousands of companies listed under them and volumes of transactions performed daily.
The financial market is regulated by regulatory bodies with stern rules and regulations. They have mandatory and stringent reporting and compliance standards. Any violation by companies, banks, investors, financial institutions, brokers, or any other authorized bodies can lead to serious and heavy penalties and, in extreme cases, even cancellation of license.
There are majorly six types of financial markets:
The money market is a financial market for short-term debt instruments with a maturity period of less than a year. For reducing transaction cost securities are bought and sold in huge quantities. This is a highly liquid market. Securities in this market are often risk free. Call money market, commercial paper, certificates of deposits, treasury and repo bills are the major instruments of this market. This market is an extremely crucial part of the financial market as it facilitates the organization of monetary policy. The chief investors in this market are financially sturdy entities such as mutual funds and banks. In comparison to other markets, the money market has low returns, hence, the participation of retail investors is comparatively low. The market is regulated by the Reserve Bank of India.
Capital markets are organizations that trade securities such as equity and debt and are responsible for arranging medium and long-term financing. The chief purpose of capital markets is mobilizing long-term savings and financing long-term investments. Furthermore, it provides liquidity by providing the investor with a means to sell financial assets, encourages the ownership of productive assets, lowers the cost of information and transactions, and enhances capital allocation by providing a mechanism for competitive pricing. The capital market participants comprise of retail investors to strong financial entities like banks and other financial institutions.
Capital markets can be classified into Primary markets and Secondary Markets.
Primary Markets- Also known as the new issue market. The scheme involves the issuance of shares and bonds for the purpose of setting up long-term funds.
Secondary Markets- This is the stock market. It is a platform for long-term securities. This market has two components: Exchange Traded Market and the Over-the-counter (OTC) Market.
- Debt market: It is the market where investors and traders buy and sell debt securities, essentially in the form of bonds. These funds are particularly sources of funds for a developing country like India. A reasonably well-segmented debt market has emerged comprising of government securities market, public sector undertaking bond market, and private corporate debt market. The government securities comprise nearly 90% of the debt market business.
- Equity market: Equity market, commonly known as the stock market, where organizations’ shares and traded. Buyers and seller can trade in both equities and shares in the same market. They are mostly traded in stock exchanges like the National Stock Exchange (NSE), Bombay Stock Exchange (BSE), and the newest entrant Metropolitan Stock Exchange of India (MSE). The stock market investing is the most popular source of income in India. Investing in the stock market gives traders and investors an opportunity of earning potentially higher returns on their investments. By venturing in the stock market, you will be able to accumulate wealth for various life goals and compound your money over time.
- Forex market: The Forex Market, also known as the Foreign Exchange Market, is the marketplace where traders trade in currencies. The Indian law allows forex market trading only in currencies. SEBI and RBI rigidly regulates foreign currencies trading in India. Therefore, in India, Forex trading is not as popular or prevalent as stock market.
- Derivatives market: The derivatives market deals with the trading of options, futures, forward contracts, and swaps. An instrument with a derivative value is an agreement whose value is acquired from the value of another asset, particularly known as the underlying asset, which may be a stock, an interest rate, a stock market index, a currency or a commodity.
Investing in any one of the financial markets is profitable for any investor or trader. Investing in these markets ensure higher returns and better investments. So, before you start investing in these markets, a thorough understanding of these markets is essential for making wiser investment-making decisions. When you make a logical and well-planned investment, you can be rest assured of gaining higher returns.
Financial Markets Made Easy
This is the best financial markets and financial planning combo learning course for stock market enthusiast and experts. This combo constitutes of 20 courses starting from basics of stock markets to expert topics like technical analysis. “Financial Markets Made Easy” is an expert-curated combo course by Elearnmarkets. Elearnmarkets is a financial e-learning platform housing thousands of stock market and financial market courses. This platform has helped lakhs of stock market enthusiasts and experts to achieve their goal of investing in the financial markets and successfully gaining returns.
Under one umbrella, you get to understand complex topics and jargon in the most comprehensive and lucid way. You will learn about stocks and equities, as well as bonds, mutual funds, and insurance that will enhance your financial planning and management skills. The fundamental and technical analysis courses will help you to select stocks by analysing financial statements, organization records, price trends, and patterns for short-term and long-term investments.
The most common and popular courses in this combo are:
- Stock Market Made Easy- This course gives you an overview of the structure and working of capital markets, its fundamentals, investment strategies, a basic understanding of technical analysis and fundamental analysis, macroeconomics and other such related topics. If you plan to become a full-time investor in the stock market, then this course is a boon for you. This course will help you to determine the right way of approaching the stock market and make better investments.
- Technical Analysis Made Easy- Technical Analysis is one of the most crucial segments of stock market investing. In technical trading, technical traders analyse the price trends and patters, and then choose the stocks they want to invest in. It is essential to get the knowledge and understanding of technical analysis, keeping in mind the volatile nature of the stock market. According to technical analysis, the past price changes of a security can provide valuable insight into the future price of that security. This course will help you to get a comprehensive understanding of technical analysis, candlestick patterns, analyse chart patterns, and resistances and support to trade.
- Option Trading Made Easy- Options are financial instruments that are based on the underlying value of stocks or other securities. Stock options can be divided into call and put options, with call options giving buyers the opportunity to profit if the stock price rises, and put options giving buyers the opportunity to profit if the stock price declines. This course will give you a proper understanding of the options and option strategies, bull and bear spread strategies, option pricing, margins and settlement, call and put options, and more.
- Fundamental Analysis for Commodities Made Easy- Fundamental analysis is a research analysis of analysing a company’s stocks taking into reference its financial statements. This course will build a framework of fundamental analysis of the participants, educate about the commodities, and the use of fundamental analysis in the commodities market. A lot of trader use both technical analysis and fundamental analysis for choosing the right stock for making investment.
- Financial Modeling Made Easy- This course is curated keeping in mind the concepts of value creation and long-term investment. It is the science of constructing models for depicting financial statements and investments. You will be exposed to the concepts of DCF modelling, strategy analysis, valuation analysis, transaction comparables, to name a few.
- Mutual Fund Made Easy: Even though mutual funds can be risky to invest but with proper and in-depth understanding of the mutual funds is profitable and it provides you with returns and growth. In this course, you will get a deeper understanding of the concepts and fundamentals of mutual funds investing, assets under management, STP, SIP, mutual fund scheme, portfolio management, and more.
These were some of the popular courses in the combo. But, this combo also houses courses like “Technical Trading Made Easy”, “RSI Made Easy”, “ROI Made Easy”, “Ratio Analysis Made Easy” for better understanding of current ratio analysis, financial and bank statements, technical and fundamental analysis; “Candlesticks Made Easy” for deeper understanding of the various candlestick patterns that assist in technical analysis; “Insurance and Taxation Made Easy” for better tax management; “Commodity Made Easy”, “Agri Trading in Commodities Made Easy” for complete understanding of commodities market; “Currency Market Made Easy” for FOREX market, “Derivatives Market Made Easy” and “Bond Market Made Easy” for a clearer outlook on the various investment strategies in derivatives and bonds.
Hence, we can say that this course this a multi-starrer pack at just Rs.3998, which gives a participant a complete, comprehensive and packed understanding of the entire financial markets through several expert-led courses, backed by videos, discussions, forums, and study materials.
Enrol today and start investing wisely in the financial markets.
Through sheer financial markets, financial planning can be made easy with proper knowledge about the different domains of the market. When you have a complete understanding of the markets, you know when to invest, buy, sell, and hold stocks, which stocks to select, whether to invest when the market is volatile or not, and various strategies to use for greater returns.