The structure of the capital market


Capital market - is part of the financial market, supply and demand are deformed mainly on medium - and long-term borrowing, specific sphere of market relations, where the object of the transaction is provided in the loan money capital formed and where supply and demand for it.

Borrowed capital - is money given to a loan under a certain percentage, subject to return.

Form of movement of the loan capital is a loan. Its main source of funds are used, which are released during playback: depreciation fund, part of the working capital in the form of money, the profit going to the renovation and expansion of the production, as well as income and savings of the population.

From a functional point of view, the capital market is a system of market relations ensures the accumulation and redistribution of money capital in order to ensure continuity of the reproduction process, the institutional - a set of financial institutions, stock exchanges, through which moves borrowed capital.

Thus, the capital market - is an integral part of the financial market, which falls on the stock market and the market of medium - and long-term bank loans. It is also a major source of long-term investments for governments, corporations and banks.

Capital market was the evolution of the market from the birth of simple commodity production in the form of access to a wide usury capital market development.

The developed world can be considered the U.S. capital market. It is celebrated on branching, the presence of a strong credit system and developed securities market, the high level of accumulation of money capital.

Capital market is one of the segments of the financial market.

Key players in this market:

• Primary investors, ie owners of free financial resources that are mobilized by banks and converted into loan capital;

• specialized intermediaries - bank financial institutions engaged in direct involvement (accumulation) in cash, turning them into loan capital and the subsequent temporary transfer to borrowers on a repayment basis for a fee in the form of interest;

• borrowers - legal entities and individuals, as well as the state, lacking the financial resources and specialized intermediaries willing to pay for the right of temporary use of them.

In Ukraine, at present, not only actively formed and functioning capital market, including all of its structural components, but also passed legislation. However, despite the rapid growth and structural changes in the national financial market, the law requires a regular review, as there are further develop and acquire new financial instruments.

The most developed sector of the capital market is the market in Ukraine long - and medium-term loans. In times of crisis the banks of Ukraine has little of such loans, preferring more liquid and less risky short-term loans. General stabilization and economic growth and contributed to the development of medium - and long-term loans, and competition in the banking sector has led to a more reasonable interest rates on these types of loans.