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primary market is when a company begin to sell there shares very first time.
secondary market is sell and buy shares of the company from share holders.
The stocks are created in primary market through an ipo whereas the stocks are traded in secondary market.
Primary market is where a company sells its Initial public offer. Where people can subscribe for the shares of the company. Once subscribed, the company issues a share certificate to the share holder confirming his ownership.
These shares once bought from the company cannot be refunded. The company will not refund the money for the shares even is the share holder wants the refund as the company would have invested the money into the business. Here is where the secondary market comes in place. The share holder cannot claim for a refund but can sell his shares to another person. This purchase and sale of shares happen in Secondary market.
The companies which are looking for public funds to expand its business can approach the people along with their business plan & company profile . Interested pupils can buy this IPO (Initial Public Offerings ) .This is called Primary Markets .
over a time period ,based on company business results & the personal needs ,pupils will start to resell the IPOs at a different price based on the market condition . This is called Stock Exchange Market which is nothing but secondary market.
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