Spot Secondary

DEFINITION of 'Spot Secondary'

The sale of a previously issued security that does not require a Securities and Exchange Commission (SEC) registration statement. Certain requirements must be met to avoid registration. A spot secondary offering is typically offered to institutional investors instead of the general public. A secondary distribution differs from a spot secondary in that the former is required to be registered with the SEC.

BREAKING DOWN 'Spot Secondary'

A spot secondary offering is not registered with the SEC and, as such, can typically be performed more quickly than other types of secondary offerings. Shares that are issued through a spot secondary offering are typically priced at a discount to institutional investors. A managing underwriter, or bookrunner, generally acts as an agent for the firm in purchasing, carrying and distributing the spot secondary offering.

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RELATED FAQS
  1. Why are the trades that occur in the secondary market important to a firm?

  2. What constitutes a secondary market?

    Find out what constitutes a secondary market, and learn why that term can be applied far more broadly than you might initially ... Read Answer >>
  3. Why do we need a secondary market?

    Find out why secondary markets play a crucial role in economic activity by promoting efficiency, safety, information and ... Read Answer >>
  4. What's the difference between primary and secondary capital markets?

    Learn how in the primary capital market, securities are issued for the first time, while in the secondary market, investors ... Read Answer >>
  5. After a federal covered security has filed notice with the Administrator for an ...

    The correct answer is b. Notice filings are required under the Act for both initial and secondary offerings of federal covered ... Read Answer >>
  6. Are secondary capital markets beneficial for society, or are there purely speculative?

    Learn why secondary bond markets are essential for both the capital market and economy. Explore the reasons they must be ... Read Answer >>
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