Which market deals with the purchase and sale of existing securities?

The secondary market is where previously issued securities are bought and sold among investors. This market provides liquidity and accessibility for investors who wish to trade their securities, allowing them to sell holdings they no longer wish to keep or to buy existing assets at current market prices. In the secondary market, transactions do not involve the issuing company directly; instead, they take place between investors. This is crucial for maintaining a healthy investment environment, as it allows for price discovery and the efficient reallocation of resources in the economy.

The primary market, in contrast, is where new securities are created and sold to investors for the first time, typically through initial public offerings (IPOs). The commodity market focuses on the trading of physical goods or raw materials rather than financial securities. The forex market deals with the trading of currencies and does not involve securities at all. Thus, the nature and purpose of the secondary market directly align with the transaction of existing securities among investors.