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Presentation on Money Market and Capital

Market In Bangladesh.
Submitted By
Md. Ariful Islam
MBA In Textile Program
ID: 2013-05-020
Submitted To
Mr. Mohammad Masum
Lecturer
Dept of Textile Management and Business Studies
Bangladesh University of Textiles
Money Market
The Trade In Short term Loans between
banks and other financial Institutions.

The money market is used by participants as a
means for borrowing and lending in the short
term period.



Functions of Money Market
transfer of large sums of money
allow governments to raise funds
determine short-term interest rates
Medium to control creation of Credit
Money Market plays crucial role in financing both internal as well as
international trade
Financial institutes of Money Market
The Central
Bank
Commercial
Bank
Institutional
Investors
Private
Individuals,
partnership
and
Companies
The Repo Market
Repo is a money market instrument which helps in collateralized short-
term borrowing and lending through sale/purchase operations in debt
instrument. Under a repo transaction, securities are sold by their holder
to an investor with an agreement to purchase them at a predetermined
rate and date.
The Commercial Bill Market
The Commercial bill market is the sub-market in which the trade bills or
the commercial bills are handled. The Commercial bill is a bill drawn by
one merchant firm on the other. Generally, Commercial bills arise out of
the domestic transactions. The legitimate purpose of a commercial bill is
to reimburse the seller while the buyer delays payment.
The Certificate of Deposit Market
A Certificate of Deposit (CD) is a time deposit with a bank. CDs are
generally issued by commercial banks but they can be bought through
brokerages.


The Commercial Paper Market
In the global money market, commercial paper is an unsecured
promissory note with a fixed maturity of no more than 270 days.
Commercial paper is a money-market security issued (sold) by
large corporation to get money to meet short term debt obligations (for
example, payroll), and is only backed by an issuing bank or corporation's
promise to pay the face amount on the maturity date specified on the note.
Money Market Mutual Fund
A money market fund's purpose is to provide investors with a safe place
to invest easily accessible, cash-equivalent assets. It is a type of mutual
fund characterized as a low-risk, low-return investment

Capital Market
A market in which individuals and institutions trade financial securities.
Organizations/institutions in the public and private sectors also often sell
securities on the capital markets in order to raise funds. Thus, this type of
market is composed of both the primary and secondary markets.
Classification of Capital Market
The Capital Market of Bangladesh consists of two part. They are-
1. Primary Market: The Primary Market is a place where new shares and
bonds are offered.
2. Secondary Market: Secondary market is a place where existing shares
and debentures are treaded.
Functions of Capital Market
Mobilization of financial resources on a nation wide scale,
Securing the foreign capital and know how to fill up the deficit in the
required resources for economic growth at a faster rate,
Effective allocation of the mobilized financial resources by directing the
same to projects yielding highest yield to the projects needed to
promote balanced economic development.
COMPONENTS OF BANGLADESI CAPITAL MARKET

New Issue Market: The new issue market is called primary market
where new shares or bonds are offered. Both the new companies and
existing ones raise capital on the new issue market.
Stock Market: Secondary or stock market represents the secondary
market where existing shares and debentures are traded. Stock
exchange provides an organized mechanism of purchase and sale of
existing securities.
Financial Institutions: Special financial institutions are the most active
constituents of Money Market. Such organizations provide medium and
long-term loans repayable on easy instalments to big business houses.
Thank You