| Basis | Capital Market | Money Market |
| Instruments | Instruments traded are shares, debentures and bonds. | Instruments traded are treasury bill, commercial paper, certificates of deposit, call money and commercial bill. |
| Duration | It deals in medium term and long term securities | It deals in short term securities |
| Expected return | The investment in capital markets generally yields a higher return | The expected rate of return of the money market is less. |
| Security/Safety | Capital market instruments are risky with respect to returns and principal repayment. | Money market instruments are generally much safer with a minimum risk of default |
| Meaning | It refers to the facilities and institutional arrangements through which funds, both debt and equity are invested and raised. | It is the market where low risk, unsecured, highly liquid short term debt instruments are issued and traded |
