The primary market is the part of the  that deals with issuing of new . Companies, governments or public sector institutions can obtain funds through the sale of a new  or  through primary market. This is typically done through an  or of securities dealers.

The process of selling new issues to investors is called . In the case of a new , this sale is an  (IPO). Dealers earn a commission that is built into the price of the security offering, though it can be found in the . Primary markets create long term instruments through which corporate entities borrow from capital market.

Once issued the securities typically trade on a  such as a ,  or .

Features[]

Features of primary markets are:

• This is the market for new long term . The primary market is the market where the securities are sold for the first time. Therefore it is also called the new issue market (NIM).
• In a primary issue, the securities are issued by the company directly to investors.
• The company receives the money and issues new security certificates to the investors.
• Primary issues are used by companies for the purpose of setting up new business or for expanding or modernizing the existing business.
• The primary market performs the crucial function of facilitating capital formation in the economy.
• The new issue market does not include certain other sources of new long term external finance, such as loans from financial institutions. Borrowers in the new issue market may be raising capital for converting  into ; this is known as "going public."