1.3 Securities Markets: Structure and Participants

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Questions and Answers

What is the primary market also known as?

  • Bond market
  • New issue market (correct)
  • Exchange market
  • Stock market

Which market facilitates trade in already-issued securities?

  • Derivatives market
  • Secondary market (correct)
  • Bond market
  • Primary market

What is the main function of the secondary market?

  • Supplying capital
  • Issuing securities
  • Creating financial assets
  • Enabling investors to exit investments (correct)

Who provides the supply of capital in the securities market?

<p>Investors (A)</p> Signup and view all the answers

What are the two inseparable segments of the securities market?

<p>Primary and secondary markets (A)</p> Signup and view all the answers

Which component facilitates interaction between investors and borrowers in the securities market?

<p>Intermediaries (C)</p> Signup and view all the answers

What is the main role of stock exchanges in the primary market?

<p>List securities (A)</p> Signup and view all the answers

Who are considered to be institutional investors?

<p>Insurance companies (A)</p> Signup and view all the answers

What is the chief objective of investors according to the text?

<p>To convert savings into financial assets that earn a return (C)</p> Signup and view all the answers

What distinguishes retail investors from institutional investors based on the text?

<p>Investment amount and sophistication of strategies (A)</p> Signup and view all the answers

Which entities provide important infrastructure services to both primary and secondary markets according to the text?

<p>Registrars and Transfer Agents (RTAs), custodians, and depositories (D)</p> Signup and view all the answers

What is a characteristic of institutional investors as described in the text?

<p>Their primary business may not be investing in securities (A)</p> Signup and view all the answers

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