Primary Market

A Primary Market is where new Financial Securities are issued by the original issuer in exchange for cash from investors.

Funds flow from investors to the issuing firm, helping raise new capital.

Examples include:

• Initial Public Offering (IPO): when a private company sells shares to the public for the first time, usually through an investment bank
• Seasoned Equity Offering (SEO): when a public company issues additional shares at a later date.

The primary market is how firms and governments create new securities and raise funds directly.