An individual investor is using the services of a broker to buy and sell stocks currently being traded in the stock market. This transaction is referred to as a primary market transaction.

Question

Quizplus · Accepted Answer

A primary market transaction refers to the buying and selling of securities directly from the issuer, typically through an initial public offering (IPO). When an individual investor uses the services of a broker to buy and sell stocks currently being traded in the stock market, it is referred to as a secondary market transaction.

An Individual Investor Is Using the Services of a Broker