Money Market Class 12 deals with all the short–term instruments traded in the financial market. These instruments are used to fulfil the working requirement needs of an organization. The concept of the Money Market is given below.
Money Market Concept Class 12
The money market is a part of financial markets where the trade is done for short-term debt instruments. These short-term debt instruments are a close substitute for money because they are highly liquid as it even involves overnight swaps of money. Here, the instruments are less risky and are actively traded.
Money Market Instruments Class 12 are unsecured. Here, when a person with the funds wants to earn some amount on that money then he puts his money into the money market in form of various instruments. Then these instruments are bought by the people or institutions in need of money for a short period of time and return the money including some returns on the funds.
The Money Market Class 12 does not necessarily have a physical platform to make the transaction thus they are mainly transacted over a call or on the internet. It is a temporary deployment of funds where the major participants include the reserve bank of India (RBI), state government, commercial banks, mutual funds, nonbanking financial institutions, large corporate houses, etc.
Money Market Class 12 notes conclude that the money market is essential for meeting working capital requirements.
BST Chapter 10 – Financial Markets