SECONDARY MARKET

Secondary Market refers to a market where

securities are traded after being initially offered to
the public in the primary market and/or listed on
the Stock Exchange.
•Majority of the trading is done in the secondary
market.
•As a general rule, the greater the number of
investors that participate in a given marketplace,
and the greater the centralization of that
marketplace, the more liquid the market.
• Secondary market is also known as "after
market”
•  In the New York Stock Exchange, all the stocks
belong to the secondary market.
•  Some of the well known stock exchanges are
NSE,BSE,NYSE,NASDAQ,LONDON STOCK
EXCHANGE.
• Considered as the barometer of the economy.
 DIFFERENCE BETWEEN THE PRIMARY
MARKET AND THE SECONDARY MARKET?
In the primary market, securities are offered to
public for subscription for the purpose of
raising capital or fund.
WHERE AS
Secondary market is an equity trading avenue in
which already existing/pre- issued securities
are traded amongst investors.
 FUNCTIONS OF SECONDARY MARKET
• For the general investor, the secondary market provides
an efficient platform for trading of his securities.
• For the management of the company, Secondary equity
markets serve as a monitoring and control conduit-by
facilitating value-enhancing control activities.
• The secondary market plays a very vital role as one of the
indicators of the industrial development of a nation.
•To analyze the trading intensity in the world stock
exchanges.
• To explain the investor awareness/ assistance/ education
programs arranged by SEBI
Products available in the Secondary Market

• Equity Shares
• Rights Issue / Rights Shares
• Bonus Shares
• Preferred Stock / Preference shares
• Cumulative Preference Shares
• Cumulative Convertible Preference Shares
• Security Receipts
Products available in the Secondary Market
Contd.
• Debentures
• Bond
• Commercial Paper
• Treasury Bills
• Government securities (G-Secs)
 SEBI AND ITS ROLE
The SEBI is the regulatory authority established
under Section 3 of SEBI Act 1992 to protect
the interests of the investors in securities and
to promote the development of, and to
regulate, the securities market and for matters
connected therewith and incidental thereto.