Advertisements
Advertisements
Question
Differentiate Spot Market from Future Market.
Advertisements
Solution
| Basis for difference | Spot Market | Future Market |
| 1. Delivery | Delivery of Financial | Instruments immediately Delivery of Financial Instruments in Future. |
| 2. Settlement | The settlement is completed immediately. | The settlement is completed in the predetermined time frame in the future. |
| 3. Payment | Payment of cash occurs immediately. | Payment of cash occurs in the future. Not immediately. |
| 4. Known as | It is also known as Cash Market. | It is also known as the forwarding Market. |
APPEARS IN
RELATED QUESTIONS
‘Zaira Ltd.’ is a large and creditworthy company manufacturing air-conditioned buses for the Indian market. It now wants to export these buses to other countries and decides to invest in new hi-tech machines. Since the investment is large, it requires long-term finance. It decides to raise funds by issuing equity shares. The issue of equity shares involves huge floatation cost. To meet the expenses of floatation cost, the company decides to tap the money market.
a. Name and explain the money market instrument the company can use for the
above purpose.
b. What is the duration for which the company can get funds through this instrument?
c. State any other purpose for which this instrument can be used.
Differentiate between `capital-market' and 'money-market' on the following basis:
Liquidity
Differentiate between 'capital-market' and 'money-market' on the basis of:
Expected return;
Differentiate between 'capital-market' and 'money-market' on the basis of:
Meaning;
Explain the following Money Market Instruments:
Treasury bill
Explain the following Money Market Instruments:
Commercial paper
State any four functions of 'Secondary - Market'.
Capital market is a market for ______.
Primary market is also called as ______.
Enumerate the different kinds of Financial Markets.
