Types of financial markets Aa Aa Financial markets across economies involve various kinds of participants and trade various types of assets and securities. It is important to understand the kinds of markets in which financial transactions take place You are preparing to take an exam in your finance class, and you've been making flash cards on different markets and transactions. Indicate the markets in which each of the following transactions will be traded: Type of Market Description of TransactionYou go to an auto dealer and buy a new car. You drive the car home immediately after making the payment. Physical asset markets Description of Transaction Type of Market An oil trader buys contracts at the New York Mercantile Exchange, and he locks in the current futures price of heating oil for delivery in the winter season. Spot markets Description of Transaction Type of Market Abbey allocates 80% of her portfolio for investments in short-term US Treasury bills. Money markets Description of Transaction Type of Market US banks raise additional capital by issuing new stocks and bonds to repay the money they received from the government during the 2008 financial crisis.