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A market where new securities are bought and sold for the first time is called the New Issues market or the IPO market. The first public offering of equity shares or convertibles securities by a company, which is followed by the listing of a companys shares on a stock exchange, is known as an initial public offering (IPO). The primary market also includes issue of further capital by companies whose shares are already listed on the stock exchange. In the primary market, new issues may be made in three ways
Public issue Rights issues Private placement
Primary Market
Secondary Market
A market in which an investor purchases a security from another investor rather than the issuer, subsequent to the original issuance in the primary market. It can be stated that secondary market are the stock exchanges and the over-the counter market. Secondary market is the segment in which outstanding issues are traded.
It provides additional funds to the issuing the secondary markets can in no companies either for starting a new circumstance supply additional funds enterprise or for the expansion or since the company is not involved in the diversification of the existing one. transaction. Its contribution to company financing is direct.
It is not rooted in any particular spot and has no geographical existence. The stock exchanges have physical existence and are located in a particular geographical area.
Stock Market
Secondary markets are also referred to as Stock Exchanges. They are part of the capital market. The stock exchanges is one of the most important institutions in the capital market, which includes term lending institutions, banks, investors, companies, and just about anybody and everybody who are engaged in providing longterm capital, whether share capital or debt capital to the industrial sector. To state simply it is the place where the securities issued by the Government, public bodies and Joint Stock Companies are traded. The Bombay Stock Exchange, the oldest stock exchange in India was established in 1875. There are 24 stock exchanges in the country at present, out of which only eight have been given permanent recognition others need to apply every year for recognition.
Stock/Equity Shares
Rights of common shareholders
Right to Income Voting Rights Proxies and Proxy contests Voting procedures
Issue Mechanism: the success of an issue depends, partly, on the issue mechanism. The methods by which new issue are made of
I. II. III. IV. V. Public Issue through Prospectus. Tender/Book building Offer for Sale Placement Method Rights Issue
Derivatives
A derivative is a financial instrument which derives its value from some other financial price. This other financial price is called underlying. The most important derivatives are futures and options.
An electronic stock exchange based in India that is comprised of small- and medium-sized firms looking to gain access to the capital markets. Like electronic exchanges in the U.S. such as the Nasdaq, there is no central place of exchange and all trading is done through electronic networks. OTCEI has been promoted by UTI, IDBI, IFCI, LIC, GIC, SBI Capital Markets and Canbank Financial Services as a nonprofit making company under section 25 of the Companies Act, 1956. The OTCEI is a recognized Stock Exchange under Section 4 of the Securities Contracts (Regulation)Act, 1956. Companies listed on the OTC exchange enjoy the same status as companies listed on any other stock exchange in the country. OTC Exchange of India has picked the model from the NASDAQ system of USA.