Distinguish between Money market and Capital Market on the basis of: (

Distinguish between Money market and Capital Market on the basis of: (a) Participants (b) Instruments (c) Safety and (d) Expected return.

Answer»

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.
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