Is a market where assets and liabilities are transacted. Which includes the following:-
• Money market.
• Capital market.
In money market, transactions of less than or equals to one year (1) year and matures after one year.
Capital market institutions includes the following:-
• Nigeria Stock Exchange: –
It is was established in 1960 as the Lagos Stock Exchange. In 1977, its name was changed to the Nigeria Stock Exchange.
It is regulated by the Securities and Exchange Commission, which has the mandate of surveillance over the exchange to forestall breaches of market rules and to deter and detect unfair manipulations and trading practices. The Exchange has an Automated Trading System (ATM)
Date on listed companies’ performances are published daily, weekly, monthly, quarterly and annually. It is privately owned and self-regulating.
• Security and Exchange Commission (SEC): –
It is formed in 1979 and it is the main regulatory institution of the Nigeria Capital Market and is been supervised by the Federal Ministry of Finance.
The Nigeria stock exchange is privately owned and is self-regulating, but the Security and Exchange Commission (SEC) maintains surveillances over it and the mandate of ensuring orderly and equitable dealings in securities and protecting the market against insider trading abuses.
• Share Registrars: –
These are companies or organizations that maintains the registers of its shareholders. Some companies set up a registrars department in-house, which means that dedicated internal staffs manages the register of its members.
However, the functions of a registrar is a specialized one, requiring professional training, expertize, experienced. Which could best be left for the experienced to handle. They also take responsibility taking up mandates from other public companies to serve as registrar to them.
• Stock Brokerage Firm: –
It is a financial institution that helps to facilitate the buying and selling of financial securities between a buyer a seller.
Brokerage firms serves a clientele of investors who trade in public stocks and other securities, usually through the firm’s agent which is known as “stock brokers”. A “full service” brokerage firms usually undertakes more than simply carrying out a stock or bond trade. The staff of this type of brokerage firms is entrusted with the responsibility of researching the markets to provide appropriate recommendations, and in doing so, they direct the actions of pension fund managers and portfolio managers too.
This firms also offer margin loans for certain approved clients to purchase investments on credit, subject to agreed terms and conditions.
• Issuing Houses: –
It serves as a financial advisers to quoted and unquoted companies, government institutions and state government, seeking to raise additional funds or funds to develop capital projects. Such as roads, schools, hospitals, infrastructures etc. from capital market.
Their activities are not limited to the big companies and government, they also function as financial advisers, stockbrokers or issuing house to would-be companies that seek to be listed on the floors of the Nigeria Stock Exchange.
They also issue bonds. This is an interest-bearing debt security/instrument issued by corporate bodies and government agencies for the financing of infrastructures or for expansion of projects.