A financial market is defined as a medium for the exchange of assets that allows buyers and sellers to interact and facilitate exchanges. However, the term can be used in a variety of contexts, including physical locations, virtual exchanges, and groups of people interested in conducting transactions.

A financial market is a broad term encompassing platforms where individuals, institutions, and governments trade financial assets. These assets include stocks, bonds, currencies, commodities, and derivatives. The primary purpose of financial markets is to facilitate the efficient allocation of capital and resources, enabling entities to raise funds and manage risks. Participants in financial markets include investors, traders, issuers, and intermediaries such as brokers and financial institutions.

There are two main types of financial markets: primary and secondary. The primary market involves the issuance of new securities, allowing companies and governments to raise capital directly from investors. In contrast, the secondary market involves the trading of existing securities among investors. Financial markets play a crucial role in determining asset prices, establishing interest rates, and influencing economic conditions. They contribute to the overall stability and functioning of the global economy by providing liquidity and fostering transparency in the allocation of financial resources.