Financial environment includes bond markets, forex markets, stock markets, commodity markets, OTC markets, Real estate markets and cash or spot markets. All these markets play an important role in raising finances for the companies and at the same time give profits to the investors. Basically a financial environment comprises of the public sector enterprises, legal authorities, fiscal authorities which are directly or indirectly impact the financial system, monetary institutions, financial institutions, and official organizations. All these organizations have a direct impact on the financial system of the companies including private and public. Therefore, in order to give the money to the people who need it and to give the profit to the people who want to invest it, financial markets play an important role.
There are a number of bodies which are known as financial markets, who are responsible for making financial environment. Financial environment in an economy deals with the monetary transactions which are based on money, time and risk. Financial environment can be further classified into financial markets which collectively constitute this environment. These financial markets include Bond market, Forex market, Stock Equities market, Money market, Commodity market, Cash market, Derivatives market, Over the counter market and Real estate market. These markets act as a platform for the buyers and the sellers to interact in the financial environment. The buyers and sellers of the financial markets are known as Market participants. These participants include investors, speculators and institutional investors. There are certain regulatory authorities (both private and government) who determine some policies and rules which are applicable in a financial environment.
Financial environment can be defined as the markets which are created because of the trading of financial securities. There are some buyers and some sellers which create financial markets and a financial environment is developed like banks, financial institutions etc. Financial environment facilitates raising of capital by creating capital markets, result in transfer of risk in the derivatives market and accomplishes international trade through currency markets.
Financial environment of a company refers to all the financial institutions and financial market around the company that affects the working of the company as a whole.
The financial environment has a number of factors. It includes the financial institutions, government, individuals and firms around the business. Firms use their financial markets to keep their savings as property. It is extremely important for the monetary markets.
Financial environment can be defined as the markets which are created because of the trading of financial securities. There are some buyers and some sellers which create financial markets and a financial environment is developed like banks, financial institutions etc. Financial environment facilitates raising of capital by creating capital markets, result in transfer of risk in the derivatives market and accomplishes international trade through currency markets.
In vary degrees, all business operate within the financial system, which consists of a number of institutions and markets serving business firms, individuals, and governments. When a firm invests temporarily idle funds in marketable securities, it has direct contact with financial markets. Other essential, mainly firms use financial markets to help savings their savings in property. Since of the significance of this environment to the monetary managers, as well as too the person as a consumer of monetary services, this section is loyal to exploring the financial scheme and the ever varying environment in which investment is raise.
Financial markets are not so much physical places as they are mechanisms for channeling savings to the ultimate investors in real assets. Monetary markets can be out of order into two programs the cash market and the money market. The cash market is concerned with the buying and selling of short term less than one year original maturity, government and corporate debt securities. The capital market, on the other hand, deals with relatively long term greater than one year original maturity debt and equity instruments e.g. bonds and stocks.
Within money and capital markets there exist both main and minor markets. A main market is a new issue bazaar. Here, funds rose through the sale of new securities flow from the ultimate savers to the ultimate investors in real assets. In a minor bazaar, accessible securities are buying and sell.
Financial Environment referred as s different functional areas of the economy which shows the outcome of economy.Investors,marketers played a very important role in this environment.Generally,it shows the financial condition of the economy.Financial environment also played a major role in the real estates i.e in building a house,malls and industries.
Basically Financial environment is very important to carry out monetary dealings in the economy. For example, all industries, businesses, companies and trades are based on the financial system of an economy. Even the government requires a financial environment to operate the state activities. Financial environment is very important to regulate money in the economy, which is also the basic purpose of the financial environment. On the basis of this aim financial intermediaries, get the money from the people who do not want to keep it idle and in return give them a return on their investment. The same money is give to the borrowers who are the businesses and the companies and who want to operate their businesses from this money. So, without creating these financial environment, no business is possible. Short term securities which are used for raising funds are also the main instruments of these markets. Therefore, for the regulation of money in the economy, financial markets are very important.
