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Studies & Degrees in Financial Markets

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When watching the news, especially the business part, the terms Dow Jones, NASDAQ and S&P 500 are sure to be mentioned by a crisp looking anchorman or anchorwoman. After the performance of the different stock market indices have been reported, the performance of the local currency against the US dollar and Euro are sure to be also mentioned along with the prices of crude oil per barrel and gold per ounce. The performance of the Financial Markets is sure to be monitored by news reports because the investing public would be very much interested to know how the markets fared and their portfolios. Basically, Financial Markets are segmented into four separate markets namely: the stock market, the bond market, currency market or forex and commodities market.

Stock Markets are where shares of listed companies are traded. Of all the Financial Markets out there, the Stock Market is perhaps the most popular one and the most liquid. Stock prices would depend on how a particular company is doing. The more profit a company amass the higher stock prices tend to rise and vice versa. For stock investors, it is always advised to always do a little research first on the company before buying them.

Bonds on the other hand, don’t have a physical market place so to speak because the underwriting party who agreed to do the bond offering would have the responsibility of selling the bonds. Bonds usually offer fixed income rates and are suitable for long term investments.

Underwriters usually sell the bonds through institutional channels that are why some bonds do not even reach the ears of the public. Bonds tend to be resilient despite unfavorable current news to investing because they are usually pegged at 10 to 25 years holding period and a lot of things can happen in a decade or more.

The Currency Market is the most volatile among all the Financial Markets. Investors in the Currency Market are usually speculators. Investors can take their pick whether to buy Yens, Euros, Francs or any other major currency against the US Dollar.

The fourth important market is the Commodities Market, also sometimes labeled as the Futures Market. When buying commodities, it is usually expressed in terms of futures contracts redeemable in a future date. The Futures Market provides a cross-cut picture of industries. It would indicate which commodities are highly in demand and which industries are lagging. The Chicago Mercantile Exchange is the world’s biggest commodities exchange. From cotton to SDRam to precious metals are all traded in a Commodities Market.

Financial Markets are usually policed by a regulating body like a Securities and Exchange Commissions and Central Banks. These financial police are the ones who make sure that no hanky-panky is happening in trading of these financial instruments. Price manipulation or rumor mongering are the usual forms of misleading the public. Right now, there are still frauds pulled off once in a while but with the current laws and rules in place pulling one off would require extreme cunning and nerves.

The Financial Markets are indeed getting more complex and so courses have now been designed to make it easier for those wanting to get into the action of high finance.