Who are the parties typically involved in capital markets?

In capital markets, the interaction between various parties is crucial for the effective functioning of the economy and facilitates the flow of capital. The correct choice identifies firms, advisors, intermediaries, and lenders/investors as central participants in these markets.

Firms are crucial as they seek financing through the issuance of stocks or bonds, while investors are essential as they provide the capital needed for these firms to grow or support projects. Advisors play a significant role in guiding firms on how to access these capital markets effectively, navigate regulations, and structure offerings to attract investors. Intermediaries, such as investment banks or brokers, facilitate transactions between firms and investors, helping to ensure that capital is allocated efficiently. Lenders, which can include banks and individual investors, are key as they provide the necessary funds for firms, expecting returns on their investment.

This inclusive understanding of the parties involved highlights the dynamic nature of capital markets and their role in supporting economic growth and investment opportunities. Other options do not encompass the full range of stakeholders necessary for the functioning of capital markets.