NIFTY 5022,500125.30(0.56%)
SENSEX74,200412.50(0.56%)
BANK NIFTY48,300210.40(0.43%)
TATA MOTORS780.0012.45(1.62%)
INFOSYS1,520.0018.20(1.18%)
WIPRO475.005.60(1.19%)
RELIANCE2,890.0034.50(1.21%)
TCS3,650.0028.10(0.76%)
HDFC BANK1,580.0015.20(0.97%)
ICICI BANK1,120.008.90(0.80%)
SBI820.005.30(0.64%)
BHARTI AIRTEL1,650.0022.80(1.40%)
HUL2,380.0012.40(0.52%)
ITC445.003.20(0.72%)
KOTAK BANK1,780.0014.60(0.83%)
LT3,420.0045.20(1.30%)
AXIS BANK1,080.009.50(0.89%)
BAJAJ FINANCE7,200.0085.40(1.20%)
MARUTI12,400150.00(1.19%)
ASIAN PAINTS2,850.0018.90(0.67%)
HCLTECH1,420.0016.30(1.14%)
TITAN3,250.0042.60(1.33%)
ADANI PORTS1,380.0022.40(1.60%)
POWER GRID310.004.80(1.57%)
NTPC365.006.20(1.73%)
SUNPHARMA1,680.008.50(0.50%)
NIFTY 5022,500125.30(0.56%)
SENSEX74,200412.50(0.56%)
BANK NIFTY48,300210.40(0.43%)
TATA MOTORS780.0012.45(1.62%)
INFOSYS1,520.0018.20(1.18%)
WIPRO475.005.60(1.19%)
RELIANCE2,890.0034.50(1.21%)
TCS3,650.0028.10(0.76%)
HDFC BANK1,580.0015.20(0.97%)
ICICI BANK1,120.008.90(0.80%)
SBI820.005.30(0.64%)
BHARTI AIRTEL1,650.0022.80(1.40%)
HUL2,380.0012.40(0.52%)
ITC445.003.20(0.72%)
KOTAK BANK1,780.0014.60(0.83%)
LT3,420.0045.20(1.30%)
AXIS BANK1,080.009.50(0.89%)
BAJAJ FINANCE7,200.0085.40(1.20%)
MARUTI12,400150.00(1.19%)
ASIAN PAINTS2,850.0018.90(0.67%)
HCLTECH1,420.0016.30(1.14%)
TITAN3,250.0042.60(1.33%)
ADANI PORTS1,380.0022.40(1.60%)
POWER GRID310.004.80(1.57%)
NTPC365.006.20(1.73%)
SUNPHARMA1,680.008.50(0.50%)
NIFTY 5022,500125.30(0.56%)
SENSEX74,200412.50(0.56%)
BANK NIFTY48,300210.40(0.43%)
TATA MOTORS780.0012.45(1.62%)
INFOSYS1,520.0018.20(1.18%)
WIPRO475.005.60(1.19%)
RELIANCE2,890.0034.50(1.21%)
TCS3,650.0028.10(0.76%)
HDFC BANK1,580.0015.20(0.97%)
ICICI BANK1,120.008.90(0.80%)
SBI820.005.30(0.64%)
BHARTI AIRTEL1,650.0022.80(1.40%)
HUL2,380.0012.40(0.52%)
ITC445.003.20(0.72%)
KOTAK BANK1,780.0014.60(0.83%)
LT3,420.0045.20(1.30%)
AXIS BANK1,080.009.50(0.89%)
BAJAJ FINANCE7,200.0085.40(1.20%)
MARUTI12,400150.00(1.19%)
ASIAN PAINTS2,850.0018.90(0.67%)
HCLTECH1,420.0016.30(1.14%)
TITAN3,250.0042.60(1.33%)
ADANI PORTS1,380.0022.40(1.60%)
POWER GRID310.004.80(1.57%)
NTPC365.006.20(1.73%)
SUNPHARMA1,680.008.50(0.50%)
NIFTY 5022,500125.30(0.56%)
SENSEX74,200412.50(0.56%)
BANK NIFTY48,300210.40(0.43%)
TATA MOTORS780.0012.45(1.62%)
INFOSYS1,520.0018.20(1.18%)
WIPRO475.005.60(1.19%)
RELIANCE2,890.0034.50(1.21%)
TCS3,650.0028.10(0.76%)
HDFC BANK1,580.0015.20(0.97%)
ICICI BANK1,120.008.90(0.80%)
SBI820.005.30(0.64%)
BHARTI AIRTEL1,650.0022.80(1.40%)
HUL2,380.0012.40(0.52%)
ITC445.003.20(0.72%)
KOTAK BANK1,780.0014.60(0.83%)
LT3,420.0045.20(1.30%)
AXIS BANK1,080.009.50(0.89%)
BAJAJ FINANCE7,200.0085.40(1.20%)
MARUTI12,400150.00(1.19%)
ASIAN PAINTS2,850.0018.90(0.67%)
HCLTECH1,420.0016.30(1.14%)
TITAN3,250.0042.60(1.33%)
ADANI PORTS1,380.0022.40(1.60%)
POWER GRID310.004.80(1.57%)
NTPC365.006.20(1.73%)
SUNPHARMA1,680.008.50(0.50%)
NISM VII — Securities Operations & Risk Management ~5 min read

Securities Market — Primary vs Secondary

A securities market is the marketplace where financial securities — shares, bonds, debentures, mutual-fund units, derivatives — are issued and traded. It has tw...

Definition

Two Halves of the Market

A securities market is the marketplace where financial securities — shares, bonds, debentures, mutual-fund units, derivatives — are issued and traded. It has two halves: the PRIMARY MARKET, where issuers raise fresh capital by selling securities for the first time (IPO, FPO, rights, private placement, QIP), and the SECONDARY MARKET, where already-issued securities trade between investors on stock exchanges.

In Simple Words
💡

When Infosys raised money from public investors in 1993, that was a PRIMARY market event — new shares, money flowing to the company. Every subsequent trade of those Infosys shares on NSE or BSE is a SECONDARY market event — no money flows to Infosys, only between two investors. The primary market mobilises capital for productive use; the secondary market provides exit/liquidity that makes the primary market attractive in the first place. Without a liquid secondary market, no investor would buy an IPO. SEBI regulates both markets under the Securities Contract (Regulation) Act 1956 and the SEBI Act 1992.

🏭
Primary = Factory

Brand-new securities created — money flows to the issuer

🏪
Secondary = Bazaar

Already-issued securities changing hands between investors

💧
Liquidity Driver

Secondary-market liquidity is what makes the primary market work

⚖️
Dual Regulation

SEBI Act 1992 + SCRA 1956 govern both halves

Real-Life Scenario

A Practical Example

📊
Primary vs Secondary
Side-by-side comparison
FeaturePrimary MarketSecondary Market
Money flows toIssuer (company)Selling investor
SecuritiesNewly issuedAlready issued
ExamplesIPO, FPO, Rights, QIP, Private PlacementNSE / BSE trading
PricingFixed / book-builtContinuous auction
RegulatorSEBI + ExchangeSEBI + Exchange
Key Points to Remember

What Makes This Important

💰
Primary market = new issuance (IPO, FPO, rights, QIP, private placement)
🤖
Secondary market = trading of already-issued securities
🪙
NSE, BSE, MSEI are the main Indian stock exchanges
⚖️
Regulators: SEBI (securities), RBI (banking & currency)
🎯
Governing law: SCRA 1956 + SEBI Act 1992 + Companies Act 2013
🧠
IFSC at GIFT City allows foreign-currency-denominated trading (not in INR)
⏸️
Liquid secondary market is essential for a functional primary market
FAQs

Frequently Asked Questions

Primary. A Rights Issue offers new shares to existing shareholders — the company receives fresh capital, so it's a primary-market transaction even though only existing holders can participate.

Test Your Knowledge

🧠 Quick Quiz

2 questions to check your understanding

2
Questions
Question 1 of 2

A company raises fresh capital by selling new shares for the first time. This is a _____.

Summary Notes

Key Takeaways

Primary = new issuance; Secondary = trading
SEBI + SCRA + SEBI Act = legal backbone
Liquid secondary is pre-requisite for primary
Back to
Module Overview
Learn SIP & Mutual Fund Investing | Free Courses | Trustner.ai