The primary market refers to the market where stocks are newly issued and not listed, and it is the primary market of stocks. Stock markets in various countries are generally secondary markets. Compared with the United States and other western countries, the secondary market of financial products such as mortgage and life insurance has not yet formed in China, so what is the secondary financial market? Is option trading a secondary market?

Source Baidu: Caishun Option

What is the secondary financial market?

The secondary financial market is the place where securities trade and circulate, and the place where securities are issued and traded. In other words, the secondary market is the trading market of any financial commodity, which can provide funds for the initial investors of financial commodities. Let's take stocks as an example to make it more clear. In order to raise funds, the joint stock limited company will choose to go public and issue shares.

The IPO market is a primary market. When new shares are traded in the primary market, they will enter the secondary market. Shanghai Stock Exchange and Shenzhen Stock Exchange belong to the secondary market, and our daily stock trading market belongs to the secondary market.

Is option trading a secondary market?

The secondary market is relative to the primary market. In different industries, primary market and secondary market have different meanings. The ways of securities trading include spot trading, futures trading, option trading, credit trading and repurchase. The market formed by securities trading is the trading market of securities, that is, the secondary market of securities.

The secondary market is where investors trade stocks, bonds, bonds, options, commercial bills, treasury bills and other existing securities. This is like an auction market. Compared with the primary market, the secondary market is more liquid, and investors only need to open a trading account to buy and sell.