GLOBALIZATION IN

FINANCIAL AND
CAPITAL MARKETS
Group 6
GLOBALIZATION

It usually refers to the integration of

the national markets to a wider global
market signified by the increased free
trade.
GLOBALIZATION IN FINANCIAL AND CAPITAL
MARKETS
Financial Market Capital Market
- It is a broad term - Capital markets refer
describing any market to the places where
place where trading savings and investments
are moved between
of securities including suppliers of capital and
equities, bonds, and those who are in need of
currencies. capital.
FINANCIAL MARKET
INTRODUCTION

 Financial institutions including banks and

institutional investors have expanded their
activities geographically.
They acted as an intermediary to
channel funds from lenders to borrowers
across national borders.
INTRODUCTION

 This resulted in an augmentation of the

range of borrowing and lending possibilities
available to economic agents throughout the
world.
 These products make it possible for
borrowers and lenders to customize their risk
exposures as well as adjust them over time.
EXAMPLES:
 New financial
instruments and
innovations
 Rapid growth in
derivative trades
 Foreign direct
investment
ADVANTAGE
Capital markets bring together
business and governments in
need of financial capital money
with investors hoping to earn
profit.
 ADVANTAGE
Individuals gain the opportunity to
smooth consumption by borrowing or
diversifying abroad, while world
savings are directed to the world's most
productive investment opportunities.
DISADVANTAGE
• Market disturbance due to factors
beyond that of domestic market.
• The risks to financial stability may
be seen as mainly arising from
market inefficiencies.
DISADVANTAGE
•Turning to the second manifestation of
financial market inefficiencies, information
problems - or coordination problems - occur
when borrowers and lenders are not able to
exchange all the information that would be
required in order to conduct transactions in an
efficient manner.
 Conclusion

 Globalized financial markets, it

is of the utmost importance that
monetary policy pursues as its
primary objective the
maintenance of price stability.
 Conclusion
 The process of globalization opens
access to borrowing, lending and
investing world-wide.
 Capital is allocated in the most
efficient manner.
REFERENCES:
Issing. (2000). The Globalisation of financial markets
Retrieved from:
https://www.ecb.europa.eu/press/key/date/2000/html/sp000912_2.en.html

Retrieved from:
http___www.aphref.aph.gov.au_house_committee_efpa_ifm_subno13.pdf

Mionel. The globalization of financial markets and the main actors

Retrieved from: https://ideas.repec.org/a/khe/journl/v5y2013i3p66-68.html

Kenton. (2019). Financial Market Definition

Retrieved from: https://www.investopedia.com/terms/f/financial-market.asp

Kenton. (2019). Capital Markets

https://www.investopedia.com/terms/c/capitalmarkets.asp
 PREPARED BY:
SORRO | SORILA | TALIBSAO | VALDEZ, JANA |
VALDEZ, SHARA | VITO