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

Which statement about the money market is correct?

The money market deals in short-term instruments with maturity up to one year, such as treasury bills, commercial paper and certificates of deposit. Equity shares and long-term bonds belong to the capital market, not the money market.

  1. AIt deals mainly in equity shares with unlimited maturity
  2. BIt deals in short-term instruments with maturity up to one yearCorrect
  3. CIt deals only in long-term government bonds
  4. DIt is regulated solely by the stock exchanges

Explanation

The money market handles short-term debt instruments such as treasury bills, commercial paper and certificates of deposit, with maturity up to one year. Equity and long-term bonds belong to the capital market.

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