A financial asset is a non-physical asset whose value is derived from a contractual claim, such as bank deposits, bonds,

and stocks. Financial assets are usually more liquid than other tangible assets, such as commodities or real estate, and may be
traded on financial markets According to the International Financial Reporting Standards (IFRS), a financial asset can be: Cash
or cash equivalent,

Equity instruments of another entity,

 Contractual right to receive cash or another financial asset from another entity or to exchange financial assets or financial
liabilities with another entity under conditions that are potentially favourable to the entity,
 A contract that will or may be settled in the entity's own equity instruments and is either a non-derivative for which the entity is
or may be obliged to receive a variable number of the entity's own equity instruments, or a derivative that will or may be settled
other than by exchange of a fixed amount of cash or another financial asset for a fixed number of the entity's own equity
instruments.[5]
 Financial assets "held for trading" — i.e., which were acquired or incurred principally for the purpose of selling, or are part
of a portfolio with evidence of short-term profit-taking, or are derivatives — are measured at fair value through profit or
loss.
 Financial assets with fixed or with determinable payments and fixed maturity which the company has to be willing and
able to hold till maturity are classified as "held-to-maturity" investments. Held-to-maturity investments are either measured
at fair value through profit or loss by designation, or determined to be financial assets available for sale by designation.
 Financial assets with fixed or determinable payments which are not listed in an active market are considered to be "loans
and receivables". Loans and receivables are also either measured at fair value through profit or loss by designation or
determined to be financial assets available for sale by designation.
 All other financial assets are categorized as financial assets "available for sale" and are measured at fair value through
profit or loss by designation.[6]
For financial assets to be measured at fair value through profit or loss by designation, designation is only possible at the amount the
asset was initially recognized at. Moreover, designation is not possible for equity instruments which are not traded in an active
market and the fair value of which cannot be reliably determined. Further (alternative) requirements for designation are e.g. at least
a clear diminution of a "mismatch" with other financial assets or liabilities, [7] an internal valuation and reporting and steering at fair
value,[8] or a combined contract with an embedded derivative which is not immaterial and which may be separated. [9] Regarding
financial assets available for sale by designation, designation is only possible at the amount the asset was initially recognized at as
well. However, there are no further restrictions or requirements.
A financial market is a market in which people trade financial securities and derivatives at low transaction costs. Securities
include stocks and bonds, and precious metals.
The term "market" is sometimes used for what are more strictly exchanges, organizations that facilitate the trade in financial
securities, e.g., a stock exchange or commodity exchange. This may be a physical location (such as the NYSE, LSE, JSE, BSE) or
an electronic system (such as NASDAQ). Much trading of stocks takes place on an exchange; still, corporate actions (merger,
spinoff) are outside an exchange, while any two companies or people, for whatever reason, may agree to sell stock from the one to
the other without using an exchange.
Trading of currencies and bonds is largely on a bilateral basis, although some bonds trade on a stock exchange, and people are
building electronic systems for these as well, to stock exchanges.
Within the financial sector, the term "financial markets" is often used to refer just to the markets that are used to raise finance: for
long term finance, the Capital markets; for short term finance, the Money markets. Another common use of the term is as a catchall
for all the markets in the financial sector, as per examples in the breakdown below.

 Capital markets which consist of:

o Stock markets, which provide financing through the issuance of shares or common stock, and enable the subsequent
trading thereof.
o Bond markets, which provide financing through the issuance of bonds, and enable the subsequent trading thereof.
 Commodity markets, which facilitate the trading of commodities.
 Money markets, which provide short term debt financing and investment.
 Derivatives markets, which provide instruments for the management of financial risk.[1]
 Futures markets, which provide standardized forward contracts for trading products at some future date; see also forward
market.
 Foreign exchange markets, which facilitate the trading of foreign exchange.
 Cryptocurrency market which facilitate the trading of digital assets and financial technologies.
 Spot market
 Interbank lending market