Question

Distinguish between the primary market and the secondary market for securities?

Distinguish between the primary market and the secondary market for securities?

Homework Answers

Answer #1

Primary Market: Primary market are the market where the securities are listed at first time. First time listing of any securities is called Initial public offers . In this companies can sell there shares to. In the IPO companies can sell there shares to people , to Banks and investors.

Secondary Market:Share are taded in the registered share market after listing of IPO is called secondary market. Means shares are tading in NASDAQ and other stock market are the source of the secondary market.

  1. In primary market shares new shares are sold and in secondary market share which are already listed are traded
  2. In primary market companies are directly involved for trading and in secondary market there is no role of companies
  3. Primary market is a addittional source for any company but the secondary market is only for investment and trading for investors and individual.
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