A range of instruments in domestic and foreign currency are traded in financial markets. In addition, the market in corporate bonds has been spurred with increased use of external credit ratings. Further, derivative products covering forwards, swaps and options as also structured products are transacted enabling corporates and banks to manage their risk exposures.
The market in securitised paper both mortgage backed and asset backed securities has also grown significantly supported by a well developed credit rating industry. Second, liberalisation in financial sector has led to emergence of financial conglomerates since banks have diversified their activities into insurance, asset management securities business, etc.