The first financial markets, came about in Europe, to fund both the industrial revolution and the expansion of the British empire. The most common location for the early financial markets was surprisingly in churches. As the need for financial trading grew, so did the places of trading, in London for example a lot of early financial trading took place in tea houses, prior to the establishment of the London Stock Exchange. Financial markets today, exist as a medium for processing financial transactions. The most common form of financial trading is usually done on stock exchanges in the form of share dealing.
Businesses generate extra investment capital by releasing shares onto the stock exchanges.
Whilst investors in shares make money by selling shares for a higher value than they are purchased for. The majority of financial markets are based in the financial capitals of the world such as the London, New York and Tokyo Stock Exchanges. Although the emergence of the internet has seen a rise in the number internet stock exchanges such as Nasdaq, as well as several on-line stockbrokers. Insurance - Short and long term. The way the LSE used to operate involved 'Jobbers' and stockbrokers.