Secondary Markets

Extracted Attributes

• Also Known As

  Aftermarket, Follow on Public Offering

• Primary Function

  Trading of previously issued financial instruments

• Instruments Traded

  Stocks, bonds, options, futures, derivatives, intellectual property, real estate shares, loans, used goods

• Examples of Markets

  Stock exchanges (e.g., BSE, NSE, NYSE), bond markets, over-the-counter (OTC) markets, commodities and derivatives exchanges, private secondary markets

• Key Characteristics

  Transactions occur between investors, not directly with the issuing entity; provides liquidity; facilitates price discovery; enables seamless transfer of ownership

• Regulatory Body (India)

  SEBI (Securities and Exchange Board of India)

Timeline

• Discussed as playing a crucial role in addressing the severe lack of liquidity and poor cash returns (DPI) within the venture capital market struggles, particularly impacting funds raised during the 2021 bubble. (Source: Related Document b42a674a-a955-4467-964b-96b7dc5a24b2)

  2024-01-01

Secondary market

The secondary market, also called the aftermarket and follow on public offering, is the financial market in which previously issued financial instruments such as stock, bonds, options, and futures are bought and sold. The initial sale of the security by the issuer to a purchaser, who pays proceeds to the issuer, is the primary market. All sales after the initial sale of the security are sales in the secondary market. Whereas the term primary market refers to the market for new issues of securities, and "[a] market is primary if the proceeds of sales go to the issuer of the securities sold," the secondary market in contrast is the market created by the later trading of such securities. With primary issuances of securities or financial instruments (the primary market), often an underwriter purchases these securities directly from issuers, such as corporations issuing shares in an initial public offering (IPO) or private placement. Then the underwriter re-sells the securities to other buyers, in what is referred to as a secondary market or aftermarket (or a buyer in contrast may buy directly from the federal government, in the case of a government issuing treasuries).

Web Search Results

• Secondary Market – Meaning, Examples, Types, How it ...

  The secondary market is a platform where existing financial securities such as shares, bonds, and derivatives are traded among investors. It enables liquidity, price discovery, and seamless transfer of ownership. Unlike the primary market, companies do not receive funds directly; transactions occur between buyers and sellers of securities. [...] The secondary market is a platform for trading securities like stocks and bonds after their initial issuance in the primary market. It allows investors to buy and sell these securities amongst themselves, facilitating price discovery and liquidity. SEBI, the Securities and Exchange Board of India, regulates this market to ensure fair and efficient trading practices. [...] Secondary markets include any financial platforms where previously issued securities are bought and sold. These include stock exchanges like BSE, NSE, and NYSE; bond markets; over-the-counter (OTC) markets; and commodities and derivatives exchanges. They enable trading between investors and ensure continuous pricing and liquidity for financial instruments. ## Bajaj Finserv app for all your financial needs and goals

• Secondary market - Wikipedia

  The secondary market, also called the aftermarket and follow on public offering, is the financial market in which previously issued financial instruments such as stock, bonds "Bond (finance)"), options "Option (finance)"), and futures are bought and sold. The initial sale of the security "Security (finance)") by the issuer to a purchaser, who pays proceeds to the issuer, is the primary market.[\[1\]]( All sales after the initial sale of the security are sales in the secondary market.\_[citation [...] The term may refer to markets in things of value other than securities. For example, the ability to buy and sell intellectual property such as patents, or rights to musical compositions, is considered a secondary market because it allows the owner to freely resell property entitlements issued by the government.[\[7\]]( Similarly, secondary markets can be said to exist in some real estate contexts as well (_e.g._, ownership shares of time-share vacation homes are bought and sold outside of the [...] Another usage of "secondary market" is to refer to loans which are sold by a mortgage bank to investors such as Fannie Mae and Freddie Mac. The term "secondary market" is also used to refer to the market for any used goods or assets, or an alternative use for an existing product or asset where the customer base is the second market (for example, corn has been traditionally used primarily for food production and feedstock, but a "second" or "third" market has developed for use in ethanol

• Types, Functions and Examples of Secondary Market

  Asecondary market is a platform wherein the shares of companies are traded among investors. It means that investors can freely buy and sell shares without the intervention of the issuing company. In these transactions among investors, the issuing company does not participate in income generation, and share valuation is rather based on its performance in the market. Income in this market is thus generated via the sale of the shares from one investor to another. [...] | | | | --- | --- | | Primary Market | Secondary Market | | Securities are initially issued in a primary market. After issuance, such securities are listed in stock exchanges for subsequent trading. | Trading of already issued securities takes place in a secondary market. | | Investors purchase shares directly from the issuer in the primary market. | Investors enter into transactions among themselves to purchase or sell securities. Issuers are thus not involved in such trading. | [...] Apart from the stock exchange and OTC market, other types of secondary market include auction market and dealer market. The former is essentially a platform for buyers and sellers to arrive at an understanding of the rate at which the securities are to be traded. The information related to pricing is put out in the public domain, including the bidding price of the offer.

• Secondary Market | Definition + Examples

  The Secondary Market is a platform where investors actively purchase and sell existing securities (post-issuance), such as stocks and bonds, amongst themselves rather than with the issuing entity. ## What is the Definition of Secondary Market? The secondary market, or “aftermarket”, is where existing securities such as stocks, bonds, and derivatives are traded among a broad range of investors, without the direct involvement of the issuer. [...] | Market Liquidity | The secondary markets provide liquidity to investors by offering a platform to buy or sell securities that were issued on a prior date (i.e. non-IPO securities). Because of the secondary market platform, investors can liquidate their holdings far more easily – i.e. conversion of investments into cash by selling their securities in the secondary market – which ultimately improves the efficiency of the market at pricing securities. | [...] Unlike the primary market, the participants in the secondary markets purchase and sell securities with each other rather than with the issuer. In practice, the term “secondary” market is most often in reference to the stock exchange, in which the shares of publicly traded companies (post-IPO) are bought and sold by investors.

• Secondary Markets & Secondary Market Transactions - Carta

  What is a secondary market? --------------------------- A secondary market is any financial market where investors buy and sell securities (such as stocks or bonds) that have already been issued. It’s “secondary” to a primary market, where securities are issued and placed into the market by an issuer in an IPO or other initial offering. ### What is a secondary market transaction? [...] The secondary market _for private stock_ is where investors can buy and sell shares of non-public companies. This private secondary market functions quite differently from the public stock market. With no centralized market infrastructure, manually matching supply and demand in the secondary market comes with certain limitations not found in the stock market. Some of those limitations include: Stock transfer restrictions No past price transparency Less efficient price discovery