Which is NOT a function of Financial Market ?

Increasing the cost of transactions

The correct answer is option (4) : Increasing the cost of transactions

The Financial Market has several functions, including:

1. Facilitating easy purchase and sale of financial assets: Financial markets provide a platform for buyers and sellers to trade financial assets such as stocks, bonds, and currencies. This helps investors to easily buy and sell securities and other financial instruments

2. Reducing the cost of transactions: Financial markets help to reduce the cost of transactions by providing a centralized platform for trading. This reduces the need for intermediaries and makes transactions more efficient and cost-effective

3. Transferring savings from savers to investors: Financial markets help to transfer savings from savers to investors who need funds for investment purposes. This helps to mobilize savings and channel them into productive investments.

4. Providing liquidity: Financial markets provide liquidity to investors by allowing them to easily buy and sell financial assets. This helps investors to quickly convert their investments into cash when needed.

5. Price discovery: Financial markets help to determine the prices of financial assets based on supply and demand. This helps investors to make informed investment decisions based on market prices.