Outline five points of distinction between primary and secondary capital market in India.

Question

The five points between primary and secondary capital market in india are as follow: &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp...

Accepted Answer

The five points between primary and secondary capital market in india are as follow: &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp...

Basis	Primary Market	Secondary Market
1. Meaning	It is the market where the securities are issued for the first time. It is also referred as New issue market.	It is the market where the existing securities are traded. It is also called stock Exchange.
2. Pricing	The prices of the securities are determined by the company.	The prices of the securities are determined by the forces of demand and supply of the securities.
3.Purchase and sale of securities	Here, only buying of the securities take place.	Here, buying and selling of the securities, both take place.
4.Ownership transferred	Securities are sold by the company directly to the investors.	Ownership of the securities is exchanged among the investors. The company is not involved at all.
5. Purpose	Purpose of primary market is to provide capital for setting new business.	The main purpose of secondary market is to provide liquidity of securities.
6.Geographical area	There is no fixed geographical area for primary market.	There is a fixed geographical area and working hours.