If you just purchased a share of IBM through a New York Stock Exchange-based transaction, you participated in: a secondary market transaction. none of the above. a primary market transaction. a futures market transaction.

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Jordan Johnston

Business

2 May, 23:21

If you just purchased a share of IBM through a New York Stock Exchange-based transaction, you participated in: a secondary market transaction. none of the above. a primary market transaction. a futures market transaction.

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Answers (1)

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Lucero · Answer 1

The correct option is A, you participated in a secondary market transaction.

Explanation:

Primary market is the market where securities are traded for the first time. For example a company issuing its shares to the public for the first time through initial public offer would have to engage the services of an issuing house or underwriter that would guarantee that the number of shares would be sold.

Underwriters even sometimes, offer to acquire outstanding shares at a commission to the the price offered.

The secondary deals stock exchanges providing platform for trading existing securities such as the New York Stock Exchange, London Stock Exchange and so on.

Futures market deals in buying and selling of derivatives such as swaps, futures, options, forward contracts, in order to reduce exposure to certain assets and liabilities