Contents

Sl. No. Subject Page

(1) Financial market and function
(2) Types of financial market , money market and capita matket
(3) Primary market , meaning and issuing
(4) Secondary market and role secondary market
(5) Stock exchange , meaning, characteristics, functions
and types of operators
(6) Securities and exchange board of india(SEBI)
Meaning, objective, function and Importance of SEBI.
FINANCIAL MARKET
Concept of financial market :--
Financial market is refers to the institutional arrangements for dealing in financial assets
and credit instrument. A financial market act as link between the sever and borrowers .
Some people have surplus money,
while other need it for investment the transfer of surplus money is undertaken through
financial market. The money is transferred from surplus unite of saver/lender , to deficit
unite (investors).
There are two ways through which funds can be
allocated :(i) through bank (ii) financial markets. The
person who have surplus money may keep their saving
in bank , or may be securities from capital market . The
banks and financial markets lend the money to
business firms . Financial market for creation and
exchange of financial assets.

FUNCTION OF FINANCIAL MARKET

Financial market perform the following functions :
[A] Mobilisation of saving and channeling them into
productive use:--The main function of financial market is

to facilitated the transfers of saving from household / saver to firm/ investor . It provides
diffrent investment option to saver , which help them to invest or channelise
their surplus funds into most productive uses .
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[B] Facilitate price determination:--The price of everything is

determined through market forces of demand and
supply.
(i) The household supply their surplus fund in the
financial market and business firm make demand .
(ii) An interaction between the severs and business firm
will help in determining the price of securities in that
financial market.
[C] Provided liquidity of financial assets;-- Financial
security can easily purchased and financial market
[i] It provides liquidity to financial assets they can
easily be converted into cash as and when required .
[ii] The holders of financial assets can easily sell them
through the mechanism of financial market .
[D] Reduce the cost of transaction .Financial market
provide full information about securities being traders
to the byers and sellers .

TYPES OF FINANCIAL MARKETS

MONEY MARKET CAPITAL MARKET
Market for short term Trader in instrument with
instruments with a maturity midium and long term
period of upto one years maturity. midium and long term
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MONEY MARKET ;--Money Market refers to a market form short term funds .It deals in
monetary assets whose
period of maturity is upto one years .
Term money market can be used in composite sence to
mean financial institution which deals with short term
funds in economy .It brings together the leander who
have surplus investable fund and the borrows who
are in need of short term funds . In money market funds
can be borrowed for a short period varying from a day ,
a week , a month ,3 to 6 month or upto one year.The
borrowed in money market are generally merchant ,
traders , manufacturings , business concerns brokers
and even governments institutions . The leander in money market include central bank
of the country , commercial banks , insurance companies and other
financial concerns .
FEATURE OF MONEY MARKET ;--
[i] It has no physical location ,most of the activities and conducted over telephone or on
internet .
[ii] It aims to provide short funds for meeting argent
requirement of cash and temporary investment of funds
for earning returns .
FUNCTION OF MONEY MERKET ;---
[i] The basis function of money market is to facilitates
adjustment of liquidity position of commercial bank ,
business corporation and other non banking financial
institutions .
PAGE 📄4 ;--
[II] It provides out let to invest stores of surplus fund .
[iii] It provides short term funds even to goverment
instruments .
[iv] It plays a vital roles in the flow of funds to the most important assets .

INSTRUMENTS OF MONEY MARKET ;--

[A] Treasury bill (T-BILL). A treasury bill is a short term instruments of money market
issued by reserve bank of india goverment .
[i] Treasury bill are available for a minimum amount of
25000 and multiples there of .
[ii] These are know as 'zero coupon bonds ' since they denote pay any invest but the issue
diffrent between
issued price the reduction price the interest the receivable

on it ,for examples , an investor purchased 90 days treasury bill with a face valu of
100000 for 94000 .by holding this bill for 90 days ,investors will receipts
100000 the difference of 6000 represent invest received by the investors .
[iii] It highly liquidity has insured return negligible risk of
default .
[B] Commercial paper ( CP) it is an inspired instrument
issued in the form of promissory note .
[i] CP is unsecured instrument issued by only large and
credite worthy companies.
[ii] It has usually a maturity period 15 days to one years .
It issued raise short term funds at lower rate of interst than market rate .
PAGE 📄 5 ;--
[iii] It is also called 'bridge finace ; for example a company
want to raise long term funds and this purpose it will have to in clear fluctuation
commercial paper .

[C] Call money ;- Call money is short term finace period varying form 1 day to 15 days .
[i] All the commercial bank are required maintained

maintained cash with RBI ,know as cash reserve ratio (CRR) . The RBI keep on the
changing the CRR ratio from
time to time which affects the availability of fund with
commercial bank to be given as lone .call money is issued by bank to maintain CRR.
[ii] The interest rate paid on call money is know as
'calll rate ' which varies frequently .
[D] Certificate of deposite . Certificate of deposite is a short term instruments issued by
commercial bank and financial institution against the deposite kept by company and
institution .
[i] These are issued to individual and coruption b during
period o f tight liquidity .
[ii] These are unsecured and negotiable .

[iii] Such instruments are usually issued by bank when they have a tight liquidity position
because of slow groth of bank deposite but the demand for credit is high .

[E] Commercial bill . it is a bill of exchange use to finace the working capital requirements
of business firms .
PAGE 📄 6;--
[i] It is a short term , negotiable instruments which is used finace credite sales of a firm .
[ii] It is a written acknowledgement of debt ,where the seller (drawer ) draws the bill and
the buyer (drawer) assets it .After acceptance it become a marketable
instrument and is called trade bill .

CAPITAL MARKET ;---

It refers to the institution arrangements for facilitate the borrowing and lending of long
term funds .Capital market is an orgained mechanised for effective and efficient transfer
of money capital .
FEATURES OF CAPITAL MARKET .
[I] Source of long term funds ;-- Capital market is meant to raise long term sources for
those who want to make productive investment . The investment should be for more than
one years .

[ii] Primary and secondary markets ;- Capital market consist of primary and secondary
market deals in new shares and mutual funds while old share and debenture and trade in
secondary market i.e.stock exchange .
[iii] Scattered and central place for activities .purchases
and sale of security of take place at commen place as well as at scared place . The stok
exchange are the main place where security are traded . The international stock exchange
(NSE) and over the counter (OTC) market have helped in transaction taking place at
scattered place through the computer and internet .
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[IV]Information of investors .Capital market provides usefull information of investors .

This information if final the parten and direction of investment . The savings may be
diverted to areas where return are higher.
Elements of capital market ;--
[i] Financial institution .There central and stock level

financial institutions which meet long term financial need of business .These institution
;IFCI, ICICI, UTI,State financial corporation ,state industrial commercial bank etc.

[ii] Investors . Individuals save to save to invest in various types of securities . Subscribers
to various securities like share ,debentures ,bonds are called investors .
[iii] sesurities.Securities are called financial assets . The securities include share ,
debentures,bonds and long term
loans .
Importance of capital market

[i] Mobilising savings . The capital market plays a vitals role in mobilising savings to put
them in productive investments so that the development of trade ,commerce and industry
could be facilitated .
capital market act as a bridges between savers and
investor . Whatever is saved is rationally investors is through capital market .
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[ii] Stability in valu .in developed capital market , the experts bankings and non bankings
intermediary put every effort to stabilise valu of stock providing capital to the need at a
lower rate of interest and cutting the speculative and unproductive activities .

[iii] Arrangements to economic growth . The process of economic growth is made easier
through the capital market . The proper allocation of resources lead to the developments
of commerce, trade and industry bith through public and private sectors .

[iv]Expert service to investors . Person dealings with share debentures etc . in the market
offer expert services to those who want to invest in capital market .
[v] Rational allocation of funds . Capital market facilitates
allocation of funds for diffrent purposes . The financial assets will be converted into
physical assets .
FUNCTION OF CAPITAL MARKET
[1]Mobilisation of financial resources on a nation-wide scale.
[2] Securing foreign capital and know -how to fill up the deficit in the required resources
for economic growth at a faster rate .
[3] Effective allocation of mobilised financial resources by directing the same to projects
needed for the country .
PAGE 📄 9
TYPES OF CAPITAL MARKET
Capital market
primary market secondary market
market for new securities market for existing
securities

PRIMARY MARKET

Primary market is also know as new issued market. This market consists of issued new
securitiei.e.share ,
debentures i.e. bonds that have never been previously issued or offered .
METHOD FOR ISSUED OR OF SECURITIES IN PRIMARY MARKET

[1]Publick issued through prospectus . As the name of suggest ,this market allows anyone
belonging to any part of india to subscribe for the securities or invest in the particular
company stock .When an offer is made by the company so that more and more people
become a part of the shareholders family ,it is know as a publick issued .
[2] Private placement .As per the name ,Private placement is the method of placing the
share from an indian company to a selected number of people . the number of people
should not excess 50 or as prescribed in any case . When the issuing of the share by the
issu is not a public issued non a right issued ,it is termed as a private placement in the
primary market . Since the issuing of the share is private limited ,meaning broker buy
these securities futher sell them to their salient . The broker and
wholesalers of the stock hear . The prometer can sell a
portion of the securities to their family members ,friends
or well-wishers . However the prometer have to make minimum contribution befor the
issued is made public.
PAGE 📄10

Materials funds , financial institution ,and and such organisation subscribed to private
placement in the primary and secondary market can be of two kinds.
(3)Right issue.The share that are beings offered to the existing shareholders of any
company are termed as a right issued in the primary market . However ,the share are
offered in the particular proportion and not haphazardly .This is an effective way of
fundraising of the securities to be sold to the shareholder .

[4] Offer for sale . An offer for sell is a simpler method wherein promoter in public
company can sell their share and reduces their holding in a transparent manner through
the building platform for the exchange .

[5] E-IPOs . It is a system of issuing security through online system .If a company decides
to offfer it securities through online system it is required to get in to an agreements with
the stock exchange. This is called initial publick offer (IPO).
Company appoint broker for accepting application and placing orders.
SECONDARY MARKET
Meaning;-Secondary market also known as stock market represent the market where
exiting securities (share and debentures )are trading . Stock exchange provides an
organised mechanism for purchase and sale of exiting securities . The investor want
liquidity for their investments . The securities which should easily be sold when they need
cash .
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Role of secondary market
[1] Secondary market deals with securities already floater in the market .
[2] It provides ready market for purchase and sale of securities .
[3] The investors are provides alternative avenues for investment .
[4] Rule and procedures are formed to simplify transaction .
[5] It helps in transfer of ownership .
[6] The investor are free to shift their investments to profitable securities .

STOCK EXCHANGE

The stock exchange is defined as an exchange of stocks between stockbrokers and traders;
it also includes the buying and selling of securities and bonds and other financial
instruments as a channel of exchanging financial equities.
Characteristics of stock exchange ;--
[1] It is a place where security purchased and sold .
[2]A stock exchange is an association of person whether incorporated or not .
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[3] The trading in an exchange in strictly regulated and rules and regulation prescribed for
various transaction .
[4] The security of corporation , trust , goverment ,municipal corporation, etc . are
allowed to be
dealt at stock exchanges .
Function of stock exchange
(i)Facilitates liquidity:-- The most important role of the stock exchange is in ensuring a
ready platform for the sale and purchase of securities. This gives investors the confidence
that the existing investments can be converted into cash, or in other words, stock
exchange offers liquidity in terms of investment.

(ii) Transactional Safety: --Transactional safety is ensured as the securities that are traded
in the stock exchange are listed, and the listing of securities is done after verifying the
company's position.

(iii)Economic growth:---The stock exchange facilitates buying and selling of securities of

various listed companies. The process of buying and selling, or trading, involves
continuous reinvestment and disinvestment, which provides an opportunity for capital
formation. Therefore, it leads to economic growth.
(iv)Price of securities:--For companies, an important function of stock exchange is raising
capital. By an increase in the security prices, companies can raise capital to fund their
business operations and projects. This helps in the growth of industries within the
country.

(v) Spread equity cult:--the stock exchange guides the investors by providing various types
of information. Consequently, the number of shareholders in companies is increasing
continuously. Thus, the stock exchanges are playing a vital role in ensuring wider share
ownership.
PAGE 📄 13

TYPES OF OPERATION AT STOCK EXCHANGE:--

[1]Brokers. Broker are members of the stock exchange who buy and sell securities on
behalf who are not the member .They charge brokerage or commission for their services.
The broker buy and sell securitie as demanded
by the investor .
[2] jobbers . These are the members of stock exchange who buy and sell security on their
own behalf and try to earn profit through price changes . Jobbers cannot trade on behalf
of outsider . In mumbai stock exchange jobber are known as tarawaniwalas .
[3] Bulls . A bull or jariwala is an operator who expects a
rise in prices of securities in the future . In anticipation of price ries ,he make purchases
share and other securities with the intention to sell at higher price in future .
[4]Bears . A bear or mandiwala speculator expect price to fall in future and sell securities
at present with a view to purchase them at lower price in future . A bear dose note have
securities at present but sell them at higher price in anticipation that he will supply them
by purchasing at lower price in future .
[5] Stage .A stage is a cautious speculator in the stock exchange . He applies for new share
in new companies and expects to sell them at a premium if he gets an allotment . He
select company whose share are more demand and likely to carry premium .
Trading procedure on a stock exchange
[i]Selection of broker .
[ii]Opening demat account
[iii] Placing an order
[iv] Matching the order
[v] executing order
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[vi]Issuing of contract note
[vii]Delivery of shares
[viii]settlement
SECURITIES AND EXCHANGE BORD OF INDIA (SEBI)
Home Personal Finance
SEBI - Securities and Exchange Board of India
The Securities and Exchange Board of India (SEBI) was founded as the regulating authority
for the Indian securities market on April 12, 1992, by the SEBI Act 1992.

What is SEBI?
SEBI is essentially a statutory body of the Indian Government that was established on the
12th of April in 1992. It was introduced to promote transparency in the Indian investment
market.

Besides its headquarters in Mumbai, the establishment has several regional offices
nationwide, including New Delhi, Ahmedabad, Kolkata and Chennai.

Objectives of SEBI

SEBI is entrusted with regulating the functioning of the Indian capital market. The
objectives of SEBI as a regulatory body are to monitor and regulate India's securities
market to safeguard investors' interests.

It aims to inculcate a safe investment environment by implementing several rules and

regulations and formulating investment-related guidelines.

Furthermore, one of the other main objectives was to avoid malpractices in the
Indian stock market.
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Function . Functions of SEBI
(i)To protect the interests of Indian investors in the securities market.
(ii)To promote the development and hassle-free functioning of the securities market.
(iii)To regulate the business operations of the securities market.

(iv)To serve as a platform for portfolio managers, bankers, stockbrokers, investment

advisers, merchant bankers, registrars, share transfer agents and others.

(v)To regulate the tasks entrusted to depositors, credit rating agencies, custodians of
securities, foreign portfolio investors and other participants.
(vi)To educate investors about securities markets and their intermediaries.
(vii)To prohibit fraudulent and unfair trade practices within the securities market and
related to it.
(viii)To monitor company takeovers and acquisition of shares.
(ix)To keep the securities market efficient and up .

IMPORTANT OF SEBI
It is a statutory regulatory body that was established by the Government of India in 1992
for protecting the interests of investors investing in securities along with regulating the
securities market. SEBI also regulates how the stock market and mutual funds
function.SEBI is important for the following reason :--
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(I)Regulating capital markets : There was no regulatory system in India which could
monitor and regular the working of financial markets. There were malpractice in financial
dealing and innocent investors were exploited by unscrupulous elements. SEBI has
provided a regulatory mechanism for controlling the working of financial markets .

(II)Protection of investors: Securities and Exchange Board of India (SEBI) is responsible for
regulations of the Mutual Funds and safeguard the interests of the investors. Investor
protection measures by SEBI are in place to safeguard the investors from the malpractices
in shares, the stock market, Mutual Fund, etc.
(III)Approaches court on behalf of investors :It provides remedies for violations of investor
protection regulations, such as unauthorized trading, misrepresentation, or non-disclosure
of material information.
(IV)Prohibits inside trading :It is considered illegal because it gives an unfair advantage to
those who possess the non-public information, and can lead to market manipulation and
loss of confidence in the securities market. In order to prevent insider trading, SEBI has
put in place a set of rules and regulations.

(V)Checks price rigging : Price rigging is the act of causing unnatural fluctuations in the
price of securities by either increasing or decreasing the market price of the stocks that
leads to unexpected losses for the investors. SEBI maintains strict watch in order to
prevent such malpractices.
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Conclusion:
Here , i have come to end of this project on the topic financial market .

I would like to my experience while doing this project . I learnt many new things about the
(financial market)
and it was wonderful learning experience for me while working on this project .
This project increased my reasearch thinking skill
and interst in this subject .
 CARTIFICATE

This is to certify that Bikash Kumar Nayak .

Student of class 12 has successfully completed.

The research of the project of principle of management under the guardian of (sambit
Kumar samal) during year 2023-2024.

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