Capital market

Capital markets connect businesses and other issuers needing long-term resources with investors seeking returns. Primary transactions raise funds for issuers when new securities are sold; secondary trading transfers existing securities between investors. Secondary liquidity and price discovery can make primary issuance more attractive, but a company does not receive fresh cash every time its shares trade. Market access can bring disclosure, governance and transaction costs. Distinguish the capital market from short-term money markets and from the internal capital-budgeting process used to select projects.