Capital market, also known as long-term capital market, is an important part of financial market. As a theoretical concept corresponding to money market, capital market usually refers to the market for medium and long-term (more than one year) lending and financing activities of funds (or assets). Because long-term financial activities involve long-term capital, high risk and long-term stable income, which is similar to capital investment, it is called capital market. In essence, capital is wealth, usually in the form of money or physical property. There are mainly two kinds of people in the capital market: those who look for capital and those who provide it. People looking for capital are usually industrial and commercial enterprises and the government; People who provide capital are those who want to make a profit by lending or buying assets. Capital, in the economic sense, refers to the basic factors of production used in production, that is, capital, factories, equipment, materials and other material resources. In the fields of finance and accounting, capital is usually used to represent financial wealth, especially financial assets used for doing business and starting enterprises. In a broad sense, capital can also be regarded as the general name of various social and economic resources for human beings to create material and spiritual wealth.
The capital market is just one of the market forms. The market consists of sellers and buyers, sometimes in physical space, such as farmers' markets or large shopping malls, and sometimes in electronic environment. The financial market is the market where financial products are traded. For example, the money market has established the mutual parity of currencies of various countries, and market participants can meet their needs or make investments by trading various currencies. Similarly, commodity futures market and capital market are also designed to meet the different financial needs of buyers and sellers. The securities market is the place where stocks, bonds, investment funds and other valuable securities are issued and traded, and it is the main component and typical form of the capital market. The providers of funds in the capital market are financial institutions, such as commercial banks, savings banks, life insurance companies, investment companies and trust companies. The demanders of funds are mainly international financial institutions, government agencies of various countries, industrial and commercial enterprises, real estate developers and sales finance companies that purchase installment contracts from retailers of durable consumer goods.