Financial Markets are forums in which traders buy and sell securities. The markets include Primary & Secondary Markets, which are not to be confused with First & Second (Over the Counter) Markets. Confused yet? The following summary should clarify things:
PRIMARY & SECONDARY MARKETS
Primary Market
TRADED BETWEEN: Issuer sells to Investors
PRICE: Public Offering Price (POP) of an Initial Public Offering (IPO)
NOTES: Proceeds go to Issuer
Secondary Market
TRADED BETWEEN: Investor to Investor
PRICE: Price is quoted when security is traded between Investors
FIRST MARKET & OTC
First Market
ALSO KNOWN AS: auction market, double auction market, or exchange market (e.g. NYSE)
Symbols are less than or equal to three letters (e.g. IBM)
Over the Counter (OTC)
ALSO KNOWN AS: negotiated market or second market (not to be confused with the secondARY market)
Symbols are greater than three letters (e.g. MSFT, CSCO)
Types include NASDAQ & non-NASDAQ. The latter trade on OTC Bulletin Board & Pink Sheets; a pink sheet stock is a penny stock
