Both primary and secondary capital markets function through the interaction of three parties: investors, issuers, and intermediaries.

Question

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Primary capital markets involve the issuance of new securities directly from issuers to investors, often with the help of intermediaries like investment banks. Secondary markets allow investors to buy and sell existing securities among themselves, with intermediaries facilitating these transactions, such as through stock exchanges or over-the-counter markets.

Both Primary and Secondary Capital Markets Function Through the Interaction