Capital is critical to corporations for running day-to-day business operations or for various business purposes. For instance, earlier stage companies need additional capital to grow to the next stage in the business life cycle. Or companies may need capital to expand organically or via acquisition, whether it be for product or regional diversification. Individuals or companies – whether at the startup level or an established firm – need capital to turn ideas into usable innovations and often new, sustainable enterprises. Governments need capital to operate their country, state, or city, as well as invest in infrastructure projects such as bridges, roadways, or schools. Therefore, capital is an integral component supporting job creation, economic development, and prosperity, and plays a crucial role in a country’s economy.
Capital markets facilitate the transfer of capital from those seeking a return (investors) to those who need capital to grow their enterprises (issuers). Capital markets, put simply, are the way we connect providers of capital with users of capital. These relationships are facilitated by financial institution intermediaries, which play a critical role in making capital markets work. Efficient capital markets allow capital users to receive lower cost funding over time while allowing investors to identify appropriate opportunities to deploy their capital.
US Capital Markets are the Largest in the World
The U.S. capital markets are the largest in the world and continue to be among the deepest, most liquid, and most efficient.
U.S. equity markets represent 49.1% of the $126.7 trillion in global equity market cap, or $62.2 trillion; this is 5.3x the next largest market, China.
U.S. fixed income markets comprise 40.1% of the $145.1 trillion securities outstanding across the globe, or $58.2 trillion; this is 2.2x the next largest market, the EU.
Download the Capital Markets Fact Book
The Capital Markets Fact Book, along with its data tables in xls format, is an annual reference containing comprehensive data on the capital markets, investor participation, savings and investment, and securities industry.