Distinguish between Primarymarket and Secondary Market.
Advertisement Remove all ads
Solution
Sr | Points | PRIMARY MARKET | SECONDARY MARKET |
1 | Meaning | The market is utilized for raising fresh capital in the form of shares and debentures. | It is a market where existing securities are resold or traded. |
2 | Function | The function is to raise long term funds through fresh issue of securities. | The function is to provide continuous and ready market for existing long term securities. |
3 | Participants | The participants are financial institutions, mutual fund, under writer, individual investor. | The participants of primary market as well as the stock brokers and the members of the stock exchange are the participants. |
4 | Listing Requirements | Listing is not required in the case of primary market. | Only listed securities can be dealt in the secondary market. |
5 | Determinants of Prices | The prices are determined by the management of the corporate houses with due compliances with the SEBI requirements for new issue of securities. |
in case of secondary market the prices are determined by forces of demand and supply in the market and they keep on fluctuating. |
Concept: Concept of Financial Markets
Is there an error in this question or solution?
Advertisement Remove all ads
APPEARS IN
Advertisement Remove all ads
Advertisement Remove all ads