NISM Certifications · NISM-Series-XV: Research Analyst · Introduction to Securities Market
Which of the following is a feature of the money market as distinct from the capital market?
The money market deals in short-term debt instruments with maturity up to one year, such as treasury bills, commercial paper and certificates of deposit. Equity shares, long-dated debentures and perpetual securities are capital market instruments, so they do not describe the money market.
- AIt deals in short-term instruments with maturity up to one yearCorrect
- BIt deals mainly in equity shares of listed companies
- CIt deals in long-term debentures with 10-year maturity
- DIt is mainly for perpetual securities
Explanation
The money market handles short-term debt instruments such as treasury bills, commercial paper and certificates of deposit with maturities up to one year. Equity shares, long-term debentures and perpetual securities belong to the capital market.
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