BUSINESS ADMINISTRATION
FINANCIAL MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Mary sells her shares of Apple stock.
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Mark contacts his broker and requests a purchase of IBM bonds.
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Sahid buys shares of a small company stock traded on the NASDAQ.
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All of the above are equity market transactions.
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Detailed explanation-1: -In India, the two forms of equity trading are the spot/cash market and the futures market. In the spot/cash equity trading the stocks are available for immediate delivery in the public financial market. Whereas in the future market the stocks are traded later at a scheduled date.
Detailed explanation-2: -A primary market is a market in which a corporation or government entity sells securities directly to investors. A common example of this type of transaction includes an IPO when a company issues shares of stock for the first time.
Detailed explanation-3: -Debt securities are financial assets that entitle their owners to a stream of interest payments. Unlike equity securities, debt securities require the borrower to repay the principal borrowed. The interest rate for a debt security will depend on the perceived creditworthiness of the borrower.