The Total solution for NCERT class 6-12
Basis of Comparison
Capital Market
Money Market
Time Span
Capital market is one part of the financial market in which borrowing and lending is of medium and long term. (more than a year)
Money market is that part of financial market where borrowing and lending is of short term or up to one year
Liquidity
Capital market instruments are less liquid
Money market instruments are highly liquid.
Returns Expected
Higher returns as investment is for longer duration
Low returns as investment is of short duration
Instruments
Capital market deals in instruments such as debentures, shares, preference shares and bonds etc.
Money markets deal in instruments such as bills of exchange, T-bill, promissory notes and call money etc.
Risk
As the instruments are less liquid in nature and long maturity
Money market securities are less risky due to short time period and sound financial position of the issuers.