Equity Capital Market - ECM


DEFINITION of 'Equity Capital Market - ECM'

A market that exists between companies and financial institutions that is used to raise equity capital for the companies. Some activities that companies operate in the equity capital markets include: overall marketing, distribution and allocation of new issues; initial public offerings, special warrants, and private placements. Along with stocks, the equity capital markets deal with derivative instruments such as futures, options and swaps.


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BREAKING DOWN 'Equity Capital Market - ECM'

Equity capital markets are very dependent on the information provided by companies regarding their current financial situations and estimates of future performance. Equity capital market teams from different investments banks are responsible for helping companies execute primary market transactions by managing the structure, syndication, marketing and distribution.

The major players within the ECMs are large financial institutions such Goldman Sachs, Citigroup and UBS.

  1. Capital Markets

    Capital markets are markets for buying and selling equity and ...
  2. Investment Banker

    Someone working at an institution raising capital for companies, ...
  3. Equity

    Equity is the value of an asset less the value of all liabilities ...
  4. Derivative

    A security with a price that is dependent upon or derived from ...
  5. Stock Market

    The market in which shares of publicly held companies are issued ...
  6. Investment Bank - IB

    A financial intermediary that performs a variety of services. ...
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