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NISM Certifications · NISM-Series-VII: Securities Operations and Risk Management · Introduction to the Securities Market

Which of the following instruments is a money market instrument rather than a capital market instrument?

A treasury bill is a money market instrument because it is a short-term government security with maturity up to one year, such as 91, 182 or 364 days. Equity shares, preference shares and ten-year debentures are long-term capital market instruments.

  1. AEquity share
  2. BTreasury billCorrect
  3. CDebenture with 10-year maturity
  4. DPreference share

Explanation

Money market instruments have maturity up to one year; a treasury bill is issued by the government for 91, 182 or 364 days. Equity shares, preference shares and long-dated debentures are capital market instruments.

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