Secondary Liquidity

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Dictionary Says

Definition of 'Secondary Liquidity'

A form of liquidity that is part of an initial public offering when shares are distributed to both retail and institutional players. These secondary parties may then sell the security to other interested buyers, with an exchange typically acting as an intermediary.

Secondary holders, or liquidity providers, often hold fewer shares and provide less liquidity and/or share volume than the initial underwriter.
Investopedia Says

Investopedia explains 'Secondary Liquidity'

When a stock or bond is traded in the secondary market, it falls into a number of different hands, both retail and institutional. These holders often have fewer shares than their underwriter counterparts. Furthermore, while they offer investors a valuable source for shares, the liquidity providers are almost always less liquid then underwriters, which may retain a large portion of the initial offering for long-term investment.
Search results for

'Secondary Liquidity'

  • A Look At Primary And Secondary Markets

    http://www.investopedia.com/articles/02/101102.asp
    ... no secondary market because unsuspecting investors can be swindled into buying them.
    The importance of markets and the ability to sell a security (liquidity ...

  • ETF Liquidity: Why It Matters

    http://www.investopedia.com/articles/exchangetradedfunds/08/ETF-liquidity.asp
    ... mutual funds. The degree of an ETF's liquidity depends on a combination
    of primary and secondary factors. Primary factors include ...

  • Break Out Of Annuity Prison

    http://www.investopedia.com/articles/pf/07/annuities.asp
    ... Annuity owners can use the secondary market to create liquidity from an asset that
    usually isn't considered as liquid as, let's say, a money market fund. ...

  • Options Trading Volume And Open Interest

    http://www.investopedia.com/articles/optioninvestor/04/060904.asp
    ... Open interest also gives you key information regarding the liquidity of an option.
    If there is no open interest for an option, there is no secondary market for ...

  • Series 7 Study Guide - Risk and Tax Considerations - Investment ...

    http://www.investopedia.com/exam-guide/series-7/investment-risk-tax-considerations/default-liquidity-political-risk.asp
    ... 13.4 Executing Trades; 13.5 Settling Transactions In The Secondary Market; 13.6
    Settlement Rules; ... Liquidity Risk The possibility that you may not find a buyer at ...

  • The Perks Of Dividend Reinvestment Plans

    http://www.investopedia.com/articles/02/011602.asp
    ... allowed. The company itself does not go into the secondary market and
    purchase the shares and then sell them through the DRIPs. ...

  • Brokerage Functions: Underwriting And Agency Roles

    http://www.investopedia.com/articles/basics/04/042304.asp
    ... This advantage of principal trading greatly adds to the liquidity of the market
    and ... as an agent or intermediary in a transaction on the secondary market, never ...

  • Electronic Trading: The Role of a Market Maker | Investopedia

    http://www.investopedia.com/university/electronictrading/trading3.asp
    ... The market makers play an important role in the secondary market as catalysts,
    particularly for enhancing stock liquidity and, therefore, for promoting long ...

  • Who Is To Blame For The Subprime Crisis?

    http://www.investopedia.com/articles/07/subprime-blame.asp
    ... the mortgages in the secondary market and collect the originating fees. This freed
    up more capital for even more lending, which increased liquidity even more. ...

  • Active Investment Management Misses The Mark

    http://www.investopedia.com/articles/trading/09/active-investment-management-critique.asp
    ... To begin, the goals of the secondary capital markets are to provide liquidity
    and transparency of trade completion. Given these ...

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