Primary Market
The primary market is a segment of the market which handles new issues of securities. The following are the major operators in the market;
1. Issuing houses
2. Stock brokers
3. Merchant and Commercial banks
4. Insurance Companies
5. The Central Bank of Nigeria (CBN)
6. Government
Investors make their instruments and funds to some of these institutions for investment purposes. The investment may be in form of stocks and shares through issuing houses (Stockbrokers and Banks), Mortgage Banks, and the sale of Commercial papers and acceptance issued by banks. Therefore, the financial institutions perform the role of financial intermediary by channeling funds from the surplus units and providing them for investment purposes.
The Secondary Market
This is the market where existing securities are traded. The market carries its activities on the floor of the stock exchange where investors and sellers of securities meet through the broker to carry out deals.
Hence, while the primary market is concerned with the issue of new securities, the secondary market provides the avenue for the sale and resale of securities.
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