Financial Market Homework Essay Example | Topics and Well Written Essays - 750 words

Financial Market Homework - Essay Example Financial markets are usually divided into capital markets and money markets. The capital market involves exchange of long term finance (Robert, 2009). This includes stock market, which facilitates financing through issuing stocks and also exchange of stock ownership and the money market which facilitates debt financing and investment (Rose, 1994). Currently the financial sector has additional markets to facilitate financing such as commodity markets derivatives market, futures markets and foreign markets. Financial markets provide borrowers with funds to facilitate their investments (such as corporations and government institutions to obtain funds in order to finance their current operations or to finance expansion and growth) (Wurgler, 2000). It also provides the lenders a platform to channel their surplus funds in productive way (such as financial institutions that have excess funds to lend on short term and long term basis), facilitates credit creation (usually done by commercial banks through issuance of loans), provides liquidity to institutions and government organizations and promotes savings culture (the commercial banks provides financial savings services) In Qatar, the financial market is controlled by Qatar Investment Authority (QIA). This is the serves as the state’s sovereign wealth fund that specializes in both local and international investments. Usually QIA manages the financial surpluses from oil and natural gas companies (which run into millions of dollars) Additionally, Qatar Holding, a branch of QIA that is in charge of international investment, receives more than $30 billion from the state. These funds are invested internationally in Europe, Asia Pacific, and United states It is estimated that QIA has assets worth over $170 billion (Hall, Kerr & Hammond, 2013). This value is expected to increase as the country continues to invest in expansion