Financial markets definition

The financial markets describe any marketplace where buyers and sellers participate in the trade of assets such as equities, bonds, currencies and derivatives. Financial markets are typically defined by having transparent pricing, basic regulations on trading, costs and fees and market forces determining the prices of securities that trade.

Financial markets can be found in nearly every nation in the world. Some are very small, with only a few participants, while others – like the New York Stock Exchange (NYSE) and the forex markets – trade trillions of dollars daily.

How Financial Markets work?

A Financial market may be a physical location or a virtual one over a network (for example, the Internet). Here, people who have a specific good or service they want to sell (the supply) interact with people who wish to buy it (the demand).

How prices are determined?

Prices in a Financial market are determined by changes in supply and demand. If market demand is steady, an increase in market supply results in a decline in market prices and vice versa. If market supply is steady, a rise in demand results in a rise in market prices and vice versa.

How can I trade in the Financial Markets?

Once you decide to enter the world of financial markets trading, you can simply open an account with a regulated financial broker which can then give you the access to the international markets throughout a Direct-access trading system transactions.