Companies utilize capital markets to raise money for projects by issuing stock IPOs, bonds and short-term money market securities. Individual investors wish to earn interest or dividends on their savings can meet companies looking to raise funds by issuing securities.

To illustrate how a corporate bond moves through capital markets, suppose AB Co. needs to raise $1000. AB Co. offers a 10-year bond on the bond market with a par value of $1000. The bond is purchased by someone wishing to earn interest on the $1000 that they have available. AB Co. receives the $1000 in cash and the investor receives a bond and the promise of repayment plus interest. Should the bondholder later decide he no longer wants the bond, he can sell it to another investor in the marketplace.

capital market is the market for items such as estate, company, cars. Risk on it is less, but investor do sometime invest less. example of it is exchange of stock. capital market is common in european country such as UK, germany, scotland etc. it is better than equity market. always consider time, profit, dividend, and demand before going into it.