Secondary market
From Freepedia
The secondary market is the financial market for trading of securities that have already been issued in an initial private or public offering. Alternatively, secondary market can refer to the market for any kind of used goods. The market that exists in a new security just after the new issue, is often referred to as the aftermarket. Once a newly issued stock is listed on a stock exchange, investors and speculators can easily trade on the exchange, as market makers provide bids and offers in the new stock.
Function
In the secondary market, securities are sold by and transferred from one investor or speculator to another. It is therefore important that the secondary market be highly liquid and transparent. Before electronic means of communications, the only way to create this liquidity was for investors and speculators to meet at a fixed place regularly. This is how stock exchanges originated, see History of the Stock Exchange.
See also
| Financial markets |
|---|
|
Economic subtypes:
Capital markets (Stock markets, Bond markets |
Primary markets, Secondary markets) |
Derivatives markets
(Futures Markets) Organisations: Stock exchange | Futures exchange Related Topics: List of stock exchanges | List of futures exchanges | Lloyd's of London | List of stock market indices |
