What are the 5 money market instruments?
Types Of Money Market Instruments
- Treasury Bills (T-Bills)
- Certificate of Deposits (CDs)
- Commercial Papers (CPs)
- Repurchase Agreements (Repo)
- Banker’s Acceptance (BA)
What are the instruments used in money market?
What Are Some Examples of Money Market Instruments? The money market is composed of several types of securities including short-term Treasuries (e.g. T-bills), certificates of deposit (CDs), commercial paper, repurchase agreements (repos), and money market mutual funds that invest in these instruments.
What are the instruments of money market in India?
The money market instruments consist of i) call (overnight) and short-notice (up to fourteen days) money, ii) term money, iii) commercial paper (CP), iv) certificates of deposit (CDs), v) money market mutual funds (MMMFs), vi) commercial bills and vii) Treasury Bills.
What is money market instruments RBI?
The money market instruments mainly comprise: (i) call money, (ii) certificates of deposit, (iii) treasury bills, (iv) other short-term government securities transactions, such as, repos, (v) bankers’ acceptances/commercial bills, (vi) commercial paper, and (vii) inter-corporate funds.
What are the main characteristics of money market instruments?
Features of Money Market Instruments
- High Liquidity. One of the key features of these financial assets is high liquidity offered by them.
- Secure Investment. These financial instruments are one of the most secure investment avenues available in the market.
- Fixed returns.
- Fixed returns.
What is money market structure?
The Indian monetary market has two broad categories – the organized sector and the unorganized sector. Organized Sector: This sector comprises of the governments, the RBI, the other commercial banks, rural banks, and even foreign banks. The RBI organizes and controls this sector.
Who is repo rate?
Repo rate refers to the rate at which commercial banks borrow money by selling their securities to the Central bank of our country i.e Reserve Bank of India (RBI) to maintain liquidity, in case of shortage of funds or due to some statutory measures. It is one of the main tools of RBI to keep inflation under control.
What are the advantages of money market instruments?
4 Benefits of a Money Market Account
- It may be insured and secured. Unlike money invested in stocks and bonds or other investment vehicles, the funds in a money market account carry lower risk.
- It comes with familiar account benefits.
- It is usually easy to access.
- It could return superior interest rates.
What are the functions of money market?
Money markets serve five functions—to finance trade, finance industry, invest profitably, enhance commercial banks’ self-sufficiency, and lubricate central bank policies.
What are the 4 financial markets?
Types of Financial Markets
- Stock market. The stock market trades shares of ownership of public companies.
- Bond market. The bond market offers opportunities for companies and the government to secure money to finance a project or investment.
- Commodities market.
- Derivatives market.
What are examples of money market instruments?
Treasury Bills (T-Bills)
What are the types of money market instruments?
It is a financial market and has no fixed geographical location.
Which are called as money market instruments?
Banker’s Acceptance
What are money market instruments?
Money Market Funds.