Question

Write a short note on secondary market or stock exchange.

Answer 1

Secondary market (Stock exchange):

• The secondary market is the market in which securities such as shares (stock), bonds, etc. which were originally issued in the primary market can be purchased and sold (traded/exchanged). The secondary market is also called the stock exchange.
• Thus, stock exchange is an organization which enables share brokers and investors to buy and sell shares, debentures and other securities. It is an organized market for trading of existing securities.
• According to K. L. Garg, “Stock exchange means a place for buying and selling industrial and financial securities like shares and debentures of a company, government securities, municipal securities.”
• The oldest and first stock exchange of India was formed on 9th July, 1875 as a “The native share and stock brokers’ Association”. Today, it is known as Bombay Stock Exchange.
• Ahmedabad Stock Exchange started in 1894.