Question

SUBJECT TESTING-I (Direct Questions)
Distinguish Between:
(2) Primary market and Secondary market.

Answer 1

Primary market	Secondary market
(i) Meaning: It is a market where new securities for the first time are flowed by issuing companies themselves.	It is place where already issued and outstanding shares are bought and sold repeatedly.
(ii) Issue of Prospectus: Prospectus is issued to invite public to subscribe to the issue of shares.	Prospectus is not issued to the public.
(iii) Type of Securities: Fresh issue of shares takes place.	Already issued (existing securities) and outstanding shares are bought and sold.
(iv) Listing of Shares: New issue of shares may not be listed in stock exchange.	Company needs to be listed on stock exchange for the purpose of trading through stock exchange.
(v) Relation with Investors: Direct contact with the investors at large is established by the companies.	There may not be direct contact with the investors who want to buy or sell the existing securities.