The G-sec markets are:
1. generally devoid of uncertainties of returns
2. involve negotiations that are generally done via auctions
3. remains unaffected by the bull and bear phases of the Financial Markets
Which among the above observations is / are correct?
Government securities market, unlike the share market is NOT an auction market. But it is an Over the counter market and the size is so large that each transaction is done with negotiations. Due to no uncertainties regarding the yield management, Addition to Capital, etc, it is generally devoid of speculations. Trades in the G-Sec market have been characterised by high volumes recorded during phases of ‘bull-runs’, with the same tapering-off during ‘bear-phases’. Thus, third statement is incorrect.
This question is a part of GKToday's Integrated IAS General Studies Module