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What are the 5 roles of financial markets?

The 5 roles of financial markets are ensuring a low cost of transactions and information, ensuring liquidity by providing a mechanism for an investor to sell the financial assets, providing security to dealings in financial assets, and providing facilities for interaction between the investors and the borrowers. You can read about the Financial Market – Functions, Features, Difference between Money and Capital Market in the given link.

It also provides pricing information resulting from the interaction between buyers and sellers in the market when they trade the financial assets.

Further readings:

  1. Capital Markets – Types, Examples, Features, Structure, Functions, and Advantages
  2. Demand and Supply – Concepts of Economy for UPSC
Related Links
Fiscal Deficit – Calculation, Components, Policy Framework Monetary System – Types of Monetary System (Commodity, Commodity-Based, Fiat Money)
Monetary Policy – Objectives, Roles and Instruments (UPSC Indian Economy) Inflation in Economy- Types of Inflation, Inflation Remedies [UPSC Notes]
Economic Survey 2021 – Definition, Importance & Highlights Fiscal Policy in India – Objectives, Components, Fiscal Consolidation, FRBM Act, 2003
Indian Economy Notes For UPSC Exam [Download PDFs] Union Budget 2021 – An Overview of Proposals on Six Different Pillars

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