मराठी

Distinction between Primary and Secondary Market

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Estimated time: 5 minutes
CBSE: Class 12

Distinction between Primary and Secondary Market

Basis Primary Market Secondary Market
Meaning Securities are sold for the first time. Sale and purchase of existing (second-hand) securities.
Types of Securities Sale of new securities. Sale and purchase of existing/second-hand securities.
Issued by Securities and bonds directly issued by companies. Securities and bonds transferred between investors only.
Capital Formation Directly contributes to company capital; funds move from surplus to deficit units. Indirectly contributes; exchange of funds between surplus units only.
Entry / Listing Companies enter to raise capital for operations. Only securities of listed companies are bought and sold.
Geographical Location No fixed geographical location; banks, institutions, foreign investors contribute. Fixed geographical location and fixed working hours.
Price Fixed by management of the issuing company. Determined by demand and supply in the stock exchange market.
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