Capital markets

Capital markets' main function is to match investible capital either directly with corporations seeking it or indirectly with market intermediaries like investment banks. They do so by listing securities, generally longer-term, for public trading.

The long haul

Capital markets include all global equities and derivatives exchanges where stocks, bonds and derivatives are traded. Traditionally, capital markets have been distinguished from money markets as trading securities with a term longer than one year, compared to the shorter-term cash securities like 90-day U.S. Treasury bills. However, the growing popularity of electronic trading on capital markets and a wider array of investment products, especially derivatives, is making this distinction increasingly obsolete.

Market regulators like the Securities and Exchange Commission (SEC) and the U.S. Federal Reserve frequently publish research on capital markets. The Federal Reserve Bank of New York, for example, posts several analytical pieces on its Capital Markets internet page, which disseminates research on "issues involving asset pricing, market microstructure, and other financial market topics." The page also contains updated financial indicators like the yield curve and stock index levels.