Enables diversification and the use of hedging tools. 4. Summary of Key Differences Primary Market Secondary Market Asset State New securities only Existing, "pre-owned" assets Capital Flow From investor to the issuer Between investors Price Setting Fixed by management/underwriters Fluctuates via supply and demand Access Primarily institutional Open to retail and institutional 5. Regulatory Oversight

Banks, pension funds, and insurance companies. 3. The Secondary Market: The Marketplace

Proceeds from the sale go directly to the issuing company or government to fund projects or expansion.