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's the difference between primary and secondary capital markets?

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  3. 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 >>
  4. What financial regulation exist to control the secondary market?

    Examine a brief characterization of financial regulation in the secondary market, including self-regulatory organizations ... Read Answer >>
  5. What kind of assets can be traded on a secondary market?

    Learn about the difference between the primary market and the secondary market, and what types of assets are traded on secondary ... Read Answer >>
  6. What is the average range for the price-to-earnings ratio in the electronics sector?

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