Primary market and Secondary market

Primary market:

The primary market of securities (some time referred to as new issues market) is the first market level at which tradeable securities originate and are directly sold to investors by the issuing entities. The primary market transactions directly flow cash into the issuing companies and contribute much of their capital to start and continue operations.

Companies can directly issue their shares to investors by means of private placement or initial public offering (IPO). Debt securities such as bonds and debentures can also be directly subscribed to from the company in the primary market. Primary market transactions largely consist of the following:

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