Primary Market and Secondary Market
Q.4 (4) Primary Market and Secondary Market
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| Points | Primary Market | Secondary Market |
|---|---|---|
| Meaning | Market for new issue of securities. | Market for buying and selling of existing (already issued) securities. |
| Other name | New Issue Market. | Stock market / stock exchange. |
| Parties | Company issues securities directly to investors. | Investors trade among themselves through brokers. |
| Funds to company | The company gets the funds. | The company does not get any funds; money moves between investors. |
| Price | Price is fixed by the company (fixed price) or through book building. | Price is decided by demand and supply in the market. |
| Place | No fixed place; done through prospectus, offer documents and intermediaries. | Takes place on recognised stock exchanges. |
| Function | Helps in capital formation. | Provides liquidity and marketability to securities. |
Doubtly AI
· 28 Oct 2026
AI-verified · Oct 2026
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