Börsenlexikon: Capital market

On the capital market, companies make medium- and long-term borrowings and investments with a term of at least one year. Capital market transactions are the issue of securities (shares, bonds, investment funds, etc.). The issuance of mortgages or other loans falls under the credit market. In contrast, the money market is used to trade short-term financial instruments. Depending on the type of security, the capital market is divided into a market for equity securities (e.g. shares and funds) and a market for debt securities (e.g. bonds). The capital market is also divided into a primary market and a secondary market. Securities are issued in the primary market, while they are traded in the secondary market after issue.