Participants on Capital Markets
The main entities seeking to raise funds on the primary capital markets are business enterprises (companies) and governments (which may be municipal, local or national).
On the primary market (where initial public offerings are done), each security can be sold only once. The process to create new shares or bonds is often lengthy due to legal and regulatory requirements.
Capital market transactions
Most capital market transactions take place on the secondary market, on which institutional investors -such as pension funds, mutual funds, and insurance companies-, retail investors and investment banks trade on their own behalf as well as on behalf of hedge funds.