What is Primary market?Back

The financial market is a place where new securities are issued to the public regularly. The primary market is the part of capital market. It is also known as new issue market for new long term capital. When companies and government required funds for further growth of the company, these companies sell those securities to public through the IPO (Initial Public Offering). It is the first chance when an investor gets the opportunity to buy a new security through the primary market. Then the company will issue the security certificates too.

There are three ways to issue a security in the primary market: