Investing term
What is Primary market?
Where a company raises money by issuing new shares. Cash flows to the company.
The primary market is where a company raises money by issuing brand-new securities — most visibly in an IPO — with the cash flowing directly to the company. It's distinct from the secondary market, where investors later trade those existing shares among themselves. Buying in the primary market funds the business; buying in the secondary market just changes who owns a share.
For example
In an IPO you buy newly created shares and your money goes to the company itself — that's the primary market in action.
Primary market is taught hands-on in Stage 5 — How Markets Work Globally.
See the lesson →