Functions of Financial Markets: Financial markets perform following four important functions… For example, you can trade various CFDs, such as metals, oil, shares and stock indexes at LiteForex, thus starting your career in the financial markets. This is the whole concept of the financial market. In other words, financial market … The financial market … Mentioned below are the important functions of the financial market. It assists in deciding the securities price by interaction with the investors and depending on the demand and supply in the market. Financial market is a market for the creation and exchange of financial assets. Bank and financial market are competitor of each other. Functions of the financial market. Functions of Financial Market. This way a financial market serves an allocative function … The banks and financial market both in turn lend the funds to business firm which is called deficit unit. A market is a place where supply for a particular good is able to meet demand for it. It mobilises savings by trading it in the most productive methods. The Forex market often combines different financial markets. Households will use their savings to buy financial instruments and commodities such as shares, stocks, debentures etc. The function of financial markets in the economy. In the case of financial markets, the good in question is money. Financial Market, in very crude terms, is a place where the savings from various sources like households, government, firms and corporates are mobilized towards those who need it.Alternatively put, financial market is an intermediary which directs funds from the savers (lenders) to the borrowers.