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.

RELATED TERMS
  1. Primary Offering

    A primary offering is the first issuance of stock from a private ...
  2. Public Offering

    A public offering is an organization’s sale of equity shares ...
  3. Secondary Stock

    A stock that is considered riskier than blue chips because it ...
  4. SEC Form S-8

    A filing with the Securities and Exchange Commission (SEC) that ...
  5. Offering

    An offering is the issue or sale of a security by a company. ...
  6. SEC Form 1-A

    A filing with the Securities and Exchange Commission (SEC) required ...
Related Articles
  1. Investing

    Comparing Primary And Secondary Capital Markets

    In the primary capital market, investors buy directly from the issuing company. In the secondary market, investors trade securities among themselves.
  2. Trading

    Combining Forex Spot And Futures Transactions

    The spot, futures and option currency markets can be traded together for maximum downside protection and profit.
  3. Insurance

    Brokerage Functions: Underwriting And Agency Roles

    Learning about these various activities can give insight into how securities are issued and traded.
  4. Investing

    Adjusting Price Charts To Secondary Offerings

    Secondary offerings may require rapid readjustment of trading strategies.
  5. Investing

    Active Investment Management Misses The Mark

    Active investment management offers little advantage in the secondary capital markets.
  6. Insights

    Understanding the SEC

    The SEC's triple mandate of investor protection, maintenance of orderly markets and facilitation of capital formation makes it a vital player in capital markets.
  7. Investing

    Market Appears Positive on Tesla's Secondary

    Trading in shares of TSLA suggests the market liked the company's recent secondary offering.
  8. Trading

    Forex: Gauging Forex Market Sentiment With Open Interest

    Examining open interest on currency futures can help you confirm the strength of a trend in forex market sentiment.
  9. Investing

    Party City Slides on Surprise Secondary Offering

    Shares of Party City Holdco (NYSE: PRTY) plunged 8% on Friday after the party goods retailer abruptly announced a secondary offering of 10 million shares. The offering will be made on behalf ...
RELATED FAQS
  1. 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 >>
  2. What's the difference between primary and secondary capital markets?

    In the primary market, investors buy securities directly from the company issuing them, while in the secondary market, investors ... Read Answer >>
  3. Buying Stock: Primary and Secondary Markets

    When you buy a stock, does that always mean that one of the shareholders is selling it to you? Read Answer >>
  4. How long is the validity period for a Series 63 exam if I have not been registered?

    Find out how registration begins using Series 63 results and how long scores are valid without registration. Learn more about ... Read Answer >>
Hot Definitions
  1. Return on Assets - ROA

    Return on assets (ROA) is an indicator of how profitable a company is relative to its total assets.
  2. Fibonacci Retracement

    A term used in technical analysis that refers to areas of support (price stops going lower) or resistance (price stops going ...
  3. Ethereum

    Ethereum is a decentralized software platform that enables SmartContracts and Distributed Applications (ĐApps) to be built ...
  4. Cryptocurrency

    A digital or virtual currency that uses cryptography for security. A cryptocurrency is difficult to counterfeit because of ...
  5. Financial Industry Regulatory Authority - FINRA

    A regulatory body created after the merger of the National Association of Securities Dealers and the New York Stock Exchange's ...
  6. Initial Public Offering - IPO

    The first sale of stock by a private company to the public. IPOs are often issued by companies seeking the capital to expand ...
Trading Center