The purpose of this paper is to examine the activity of stock trading on the Zagreb Stock Exchange and the level of liquidity on the Croatian stock market during the period from 2005 to 2018. The theoretical portion of the paper lists and clarifies the basic concepts related to the financial markets, primarily the capital market, where monetary policy has a significant impact. Although the emphasis is on the Zagreb Stock Exchange, other stock exchanges are also examined to see how they operate and to show the key factors that influence an investor's decision to buy financial instruments on a stock exchange. An indispensable part of this paper is the analysis of the official indexes of the Zagreb Stock Exchange, and stock indexes in general, which provides a broader insight into the economic composition of a particular country. Trades are made on the capital market using various types of securities that have been clarified in greater detail. The similarities and differences between securities, their individual characteristics, divisions, and whose prices they affect and how, are very clearly defined. The research part of the work identifies and analyzes stock prices with data obtained from the Zagreb Stock Exchange. Current stock prices, such as those for the most liquid stocks on the exchange, are shown for the current Croatian capital market. An analysis of stock market activity has also been carried out for the observed period. The reasons for the general decline in value and the reduction of liquidity have also been analyzed. In addition, the liquidity of the Croatian capital market has been observed, defined, and presented for the given period and in its current state. The conclusions include suggestions, tips and examples for practice.