Secondary Market

Secondary Market is the market where, unlike the primary market, an investor can buy a security directly from another investor in lieu of the issuer. It is also referred as “after market”. The securities initially are issued in the primary market, and then they enter into the secondary market.
All the securities are first created in the primary market and then, they enter into the secondary market. In the New York Stock Exchange, all the stocks belong to the secondary market.In other words, secondary market is a place where any type of used goods are available.

In the secondary market, shares are maneuvered from one investor to other, that is, one investor buys an asset from another investor instead of an issuing corporation. So, the secondary market should be liquid.

Example of Secondary Market:

In New York Stock Exchange, in the United States of America, all the securities belong to the secondary market.

Importance of Secondary Market:
Secondary Market has an important role to play behind the developments of an efficient capital market. Secondary market connects investors’ favoritism for liquidity with the capital users’ wish of using their capital for a longer period.

For example, in a traditional partnership, a partner can not access the other partner’s investment but only his or her investment in that partnership, even on an emergency basis. Then he or she can break the ownership of equity into parts and sell his or her respective proportion to another investor. This kind of trading is facilitated only by the secondary market.

Know More About Secondary Market
Secondary Market SBA Secondary Market
Private Equity Secondary Market MBA’s National Secondary Market Conference

 

More Information About Capital Market
Primary Market Secondary Market Primary Vs Secondary Market
Global Capital Market Capital Market Companies Capital Market Reform
Venture Capital Market Capital Market Transactions Capital Market Line
Capital Market Services Capital Market Securities Capital Market Liberalization
Secondary Infrastructure Fund Capital Market Risk Capital Market Integration
Capital Market Instruments Equity Capital Market Efficient Capital Market
Debt Capital Market Capital Market Consultants Capital Market Conditions
Market Regulation Committee Capital Market Assumptions Capital Market Trends
Capital Market Theory Role Of Capital Market Risk Advisor
Capital Market Regulations Capital Market Investment Capital Market Research

Last Updated: 23rd June 2015