Capital market is a market for long-term debt and equity shares. In this market, the capital funds comprising of both equity and debt are issued and traded. This also includes private placement sources of debt and equity as well as organized markets like stock exchanges. Capital market can be further divided into primary and secondary markets. In recent years, complex financial products, such as derivatives, have proliferated in developed countries. These products have become highly popular with banks and financial institutions as they allow them to hedge their risks and manage their regulatory and economic capital more efficiently.