What is meant by Primary and Secondary market? What is the difference between them?


A market that issues new securities on an exchange. Companies, governments and other groups obtain financing through debt or equity based securities is primary market.

The secondary market is also called aftermarket is the financial market in which previously issued financial instruments such as stocks , bonds , futures , options are bought and sold.

Source: http://www.investopedia.com/terms/p/primarymarket.asp

Source: http://en.wikipedia.org/wiki/Secondary_market

‘Primary Market’ to simply put it, is the way by which an investor can invest in securities before being listed on a recognized exchange. For equity shares, it is done through the process of Initial Public Offering[IPO].

‘Secondary Market’ is a way by which Purchase and Sale of a security happens on a recognized exchange. It is a regulated place/ platform for interaction between buyers and sellers.


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