| Basis | Capital Market | Money Market |
| Participants | The participants are financial institutions, banks, corporate, foreign investors and retail investors. | The participants are RBI, financial institutions, banks, corporate. |
| Instruments | Instruments traded are shares, debentures and bonds. | Instruments traded are treasury bill, commercial paper, certificates of deposit, call money and commercial bill. |
| Investment outlay | Investment outlay is small. | Investment outlay is large. |
| Duration | It deals in medium term and long term securities | It deals in short term securities |
| Liquidity | Capital market securities are comparatively less liquid. | Money market securities are comparatively more liquid. |
| Expected return | The investment in capital markets generally yields a higher return | The expected rate of return of the money market is less. |
| Security/Safety | Capital market instruments are risky with respect to returns and principal repayment. | Money market instruments are generally much safer with a minimum risk of default |
| Meaning | It refers to the facilities and institutional arrangements through which funds, both debt and equity are invested and raised. | It is the market where low risk, unsecured, highly liquid short term debt instruments are issued and traded |
| Location | There is no fixed geographical area. All the institutions, banks, foreign investors etc., constitute primary market. | There is a fixed geographical area and working hours. |
