Global financial system and exchanges

The global financial system and exchanges are critical components of the global economy, facilitating the flow of capital, investment, and trade between nations. Here are a few key aspects of the global financial system and exchanges:

Stock markets: Stock markets provide a platform for companies to raise capital by selling
shares of their ownership to investors. Stock markets also provide a mechanism for investors
to buy and sell shares in these companies, facilitating investment and wealth creation.

Bond markets: Bond markets provide a platform for governments, corporations, and other
entities to raise capital by issuing bonds, which are a form of debt. Bond markets also
provide a mechanism for investors to buy and sell these bonds, providing a source of income
and diversification for their portfolios.

Foreign exchange markets: Foreign exchange markets facilitate the exchange of currencies
between countries, enabling international trade and investment. These markets are critical for businesses and individuals who need to convert one currency into another for
transactions.

Derivatives markets: Derivatives markets provide a platform for investors to manage risk by
buying and selling financial instruments that are based on underlying assets such as stocks,
bonds, and commodities.

Regulatory framework: The global financial system is regulated by a variety of national and
international regulatory bodies, such as the Securities and Exchange Commission (SEC) in the United States and the International Organization of Securities Commissions (IOSCO). These regulatory bodies help ensure the integrity of the financial system and protect investors from fraud and other abuses.

Therefore, the global financial system and exchanges play a crucial role in facilitating investment, trade, and economic growth around the world. By providing a platform for companies to raise capital, investors to invest in these companies, and individuals and businesses to engage in international trade and investment, the financial system helps create wealth and opportunity for people around the world. However, it is important to ensure that this system is regulated effectively to prevent abuses and protect the interests of all stakeholders.