Securities Markets and Economic Factors

In this section

• Securities Market Overview
  Understand how securities markets function, who participates, and how regulation supports market integrity.
  • Functions of Securities Markets
    Learn how securities markets support capital formation, liquidity, price discovery, and risk transfer.
  • Market Participants in Securities Markets
    Review the key firms, issuers, investors, and intermediaries active in securities markets.
  • Regulation of Securities Markets
    See how SEC, FINRA, and related rules shape securities market conduct and oversight.
• Types of Securities Markets
  Compare the primary, secondary, third, and fourth markets and the role each plays in trading.
  • Primary Market, IPOs, and Underwriting
    Understand new issue offerings, IPO mechanics, and the underwriter's role in the primary market.
  • Secondary Market Trading
    Review how existing securities trade after issuance and how secondary markets provide liquidity.
  • Third and Fourth Markets
    Learn how third and fourth markets operate outside standard exchange venues.
• Economic Factors and Business Information
  Review the economic data and policy forces that shape securities markets and investor expectations.
  • Economic Indicators
    Use leading, coincident, and lagging indicators to interpret economic conditions for Series 7 scenarios.
    • Leading Economic Indicators
      Learn how forward-looking data points can signal future changes in the economy and markets.
    • Coincident Economic Indicators
      Review indicators that move with the current economy and confirm present business conditions.
    • Lagging Economic Indicators
      Understand indicators that confirm trends after the economy has already shifted.
  • Business Cycles and Investment Implications
    See how expansion, peak, contraction, and trough phases affect markets and investment decisions.
  • International Economic Factors and Securities Markets
    Understand how global conditions, currency trends, and foreign developments can affect U.S. securities markets.
  • Fiscal and Monetary Policy
    Review how government spending, taxation, and Federal Reserve policy influence market conditions.
• Interest Rates and Inflation
  Understand benchmark interest rates, inflation, and how rate changes affect securities prices.
  • Types of Interest Rates
    Distinguish the federal funds, discount, and prime rates and how each affects borrowing costs.
    • Federal Funds Rate
      Understand how the federal funds rate influences monetary policy and short-term market conditions.
    • Discount Rate
      Learn how the discount rate fits into Federal Reserve lending and broader monetary policy.
    • Prime Rate
      See how the prime rate is used in lending and why it matters for markets and credit.
  • Inflation and Deflation in Securities Markets
    Review how inflation and deflation affect purchasing power, securities values, and investor behavior.
  • Interest Rates and Bond Prices
    Understand the inverse relationship between interest rates and bond prices.