Are they same? What’s the difference?
In my text book, “money market funds” and “treasury bills” are under cash equivalents, while trading securities is under marketable securities.
What’s the difference between “money market ” and “securities market”?
07
Jun
John S
June 7, 2010 at 6:55 pm
They’re exactly what their names tell you they are. The “money market” is a wholesale cash market, where cash or “money” (hence the name), is “bought” or “sold” for a short period – overnight to 270 days. The largest financial institutions, corporations and governments participate in this market to raise capital to meet their short term cash obligations. Treasury bills are short term papers issued by the US Treasury Department, for this purpose, that’s why they’re money market instruments.
The “securities market” is again, basically the market for securities, including mainly stocks, bonds, derivatives, structured products and agency securities. It’s where securities are bought or sold, hence the name. Securities where there exists a market for them to be traded are called, again not surprisingly, “marketable securities” such as those listed above.
jeff410
June 7, 2010 at 7:20 pm
Money market funds are usually very short term debt. Marketable securities are generally longer term debt and equity investments. Money market funds and treasury bills are considered very safe and liquid. They are used as a safe and liquid place to store cash on a short term basis. Marketable securities are used for investment. They have different purposes for a company. Thats the reason they are under different headings.
TimothyLogan3
June 7, 2010 at 8:03 pm
By securities I assume you refering to equities, which are company shares. And money markets are markets where cash and cash equivalent are invested and loans are made by financial institutions for very short periods.
b2fnow
June 7, 2010 at 8:30 pm
Your best bet for financial terms are here:
http://www.investopedia.com/terms/m/moneymarket.asp
http://en.wikipedia.org/wiki/Securities
http://en.wikipedia.org/wiki/Equity_(finance)
http://en.wikipedia.org/wiki/Securities_market
mrzwink
June 7, 2010 at 8:36 pm
the money market is the market that trades money. .e.g selling dollars and buying yuen because you need to pay someone chinese.
the security market trades securityies (pieces of paper that represent a debt or ownership) e.g. buying a share in apple or a piece of debt