Secondary Market

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Secondary Market logo
Type Info
Chinese name 二级市场
Foreign name Parallel market
Alias Secondary market
Effect Securities trading, transfer and circulation

Secondary market[edit]

  • The secondary market refers to the market formed by the trading of various securities between different investors after the issuance of securities, also known as the circulation market or the secondary market. For example, the Shanghai Stock Exchange and the Shenzhen Stock Exchange belong to the secondary market. The income from the sale of securities in the secondary market belongs to the investor who sells the securities and not to the company that issued the securities.[1]

Interpretation[edit]

  • Secondary market
    Secondary Market
    is a trading place for securities, a circulation market, and a place where securities are issued for trading.
  • The secondary market is a capital market that allows for the sale or purchase of financial securities that have been publicly issued or privately issued. In other words, the secondary market is the trading market for any old financial commodity that provides funding for the initial investor of financial commodities. Liquidity. Financial goods here can be stocks, bonds, mortgages, life insurance, etc.
  • The secondary market exists after the new securities are issued, sometimes referred to as the "aftermarket". Once the newly issued securities are listed on the stock exchange, the market maker starts bidding and After the new securities are offered, investors and speculators can trade more easily.
  • The stock market of each country is generally a secondary market. Compared with Western countries such as the United States, the secondary market for financial products such as mortgages and life insurance has not yet formed in China.
  • See also: Primary market

Classification[edit]

  • The stock exchange market is divided into two categories: one is large, active and orderly on-floor transactions, that is, transactions conducted on stock exchanges; the other is over-the-counter transactions without fixed locations, mostly on the telephone.
  • Stocks are sold by issuers and publicly sold in stocks and reach the public investing in two different stages. Stock markets in capitalist countries
    Stock Exchange
    Generally divided into "primary securities market" (or "primary securities market") and "secondary securities market" two categories.
  • In the primary securities market, there are new securities issued by enterprises and countries. The trading here is dominant. In the secondary securities market, there are two pre-issued or supplementary issued securities. In this market, The exchange plays a major role. The Securities and Exchange Commission stipulates that the broker who buys and sells stocks on the exchange must be a member of the exchange organization. The stocks traded on the exchange must be approved listed stocks because of the cost of trading stocks on the exchange. High, thus the listing of transactions by non-exchange member brokers outside the exchange trading channels. This stock exchange listed on the exchange, but in the OTC market trading market, known as the "third market." In addition, various investment companies, insurance companies, annuity funds, mutual savings associations and other professional financial institutions buy and hold stocks in large quantities, which has become a pivotal force in the stock exchange market. These large institutions and some giant companies are willing to pay high prices to buy exchanges. In order to more favorably engage in various stocks, bond trading activities, this way of stock trading has formed a singleThe market, known as the "fourth market."

Characteristics[edit]

  • 1. The stock exchange is dominated by securities investors, which are mainly holders of securities and currency holders who are prepared to purchase securities. In addition, securities issuers and securities intermediaries are also participants in the stock exchange market, but The role is to assist investors in conducting and completing transactions, rather than independent participants in securities trading activities. As an exception, securities intermediaries may also act as investors.
  • 2. The stock exchange market mainly adopts the form of tangible market, and there are also a few intangible markets.
  • Stock exchanges are typical tangible markets with fixed locations, facilities, equipment and professionals; other stock exchanges, such as over-the-counter markets, often use decentralized transactions, but generally rely on securities company counters and trading networks. Completion, it is also a tangible market in a broad sense. According to the composition and existence of the stock exchange market, the stock exchange market can be subdivided into stock exchanges and over-the-counter markets.
  • 3. The stock exchange market and the securities issuance market are interdependent.
  • The dependence of the stock exchange market on the securities issuance market, first of all, because the stock exchange market uses the issued securities as the transaction object, and the securities exchange
    US Stock Exchange
    The trading market of the easy market is the securities that have been issued, not the securities that have not yet been issued. In this sense, the securities issuance market is the premise of the securities trading market. On the other hand, the current public offering of stocks in China mostly relies on stock exchange transactions. The network, adopting the "online distribution method", makes the securities issuance market also dependent on the securities trading market. The relationship between the securities issuance market and the trading market is extremely complicated, regardless of the type, price, quantity and scale of the securities issued. To a certain extent, it is subject to the securities trading market. China's Securities Law allows securities issuers to negotiate pricing with securities companies, resulting in the gradual integration of the issue market price with the market price of the transaction, and the connection between the two markets has become closer. It can be said that there is an interaction between the securities issuance market and the trading market.

Effect[edit]

  • The secondary market is to provide liquidity for securities. Maintaining the liquidity of securities allows securities holders to sell their securities at any time and realize them. (For example, securities holders cannot always take their own hands. The realization of securities will result in unattended purchase of securities.) It is precisely because of the way to realize the realization of securities, the secondary market can also price the securities to show the securities market to the securities holders. price.

Influences[edit]

  • China's new share issuance adopts an approval system. In the history of A shares, there are 8 IPO suspensions and 7 restarts. According to the latest research report of GF Securities, the historical data statistics and analysis are summarized as follows:
  • (1) Before and after the IPO restart or suspension, the market mostly continues the trend before the change. The IPO is not the turning point of the market, but it is the accelerator of its rise or fall. Overall, the impact of the IPO restart on the Shanghai Composite Index is negative; IPO Pause is biased towards the front.
  • (2) The IPO was suspended, and the impact on the GEM was basically the same. The small and medium-sized board index showed a 30% rise during the three suspension periods. Both restarts were in the bull market background and did not change the trend of continuing to rise.
  • How big is the impact of IPO restart on IPO
  • (1) Due to the current small and medium-sized board, the proportion of new shares in the GEM has increased significantly. The number of new shares applied for listing continues to increase, and the number of listed shares will continue to remain high. Analysts expect 20-30 homes/month.
  • (2) The issued share capital is getting smaller, and the scale of single financing is getting smaller.
  • (3) After the previous restarts, the market is generally sought after for new stocks. At the beginning, the rate of winning is low. After the new stocks are sufficient, they will gradually increase.[2]
  • (4) After the restart, the P/E ratio is initially higher, but it will continue to decline gradually, and is expected to remain around 20 times.
  • (5) The first day after the restart, the increase was higher, but it should be alert to the risk of continuing to fall after listing in 2012.

Features[edit]

  • (1) Promote the conversion of short-term idle funds into long-term construction funds;
  • (2) Adjusting the supply and demand of funds, guiding the flow of funds, and providing channels for direct financing of commerce;
  • (3) The stock price changes in the secondary market can reflect the economic situation of the whole society;
  • (4) Maintain reasonable prices of stocks, free trade, well-informed, and meticulous management to ensure that the interests of both buyers and sellers are strictly protected.

Entry method[edit]

  • Investors who need to enter the market should open a securities account card in advance. Open the Shenzhen Securities Account Card and the Shanghai Securities Account Card respectively.

Account card[edit]

  • Shenzhen Securities Account Card
  • Investor: You can apply through the local securities business department or securities registration agency. You need to provide your valid ID card and photocopy. If you entrust someone to do it, you need to provide the ID card and photocopy of the agent.
  • Legal person: Hold business license (and photocopy), legal person power of attorney, legal representative certificate and manager ID card.
  • Securities investment fund, insurance company: Opening an account card is required to go directly to the Shenzhen Stock Exchange.
  • Account opening fee: 50 yuan per person / per account; agency 500 yuan / per account.
  • Securities trading
  • Shanghai Securities Account Card Investors: You can go to the Shanghai Securities Central Registration and Clearing Corporation at the account opening agency of each place to apply for the opening of a securities account, with valid ID documents and photocopies.
  • Legal person: The original or copy of the legal person business license, or the original and photocopy of the legal person registration certificate issued by the civil affairs department and other competent departments; the legal representative's power of attorney and the valid identification of the manager and a copy of it.
  • Entrusting others to do so: You must provide the agent's identification and a copy of it, and the client's power of attorney.
  • Account opening fee: personal paper card 40 yuan, personal magnetic card local 40 yuan / each account, 70 yuan / each account; agency 400 yuan / each account.

Securities account opening[edit]

  • After investors apply for the Shenzhen Stock Exchange account card, they must first open an account in the securities business department before going to the securities business department to buy and sell securities. The account opening is mainly at the business counter of the securities company's sales department or the designated bank to open an account, and then the securities can be bought and sold.
  • Account opening procedure
  • (1) The original and photocopy of the ID card must be provided for the personal account opening, and the original and copy of the Shenzhen Securities account card.
  • If it is an agent, it is also necessary to sign the "Power of Attorney" with the client and provide the original and photocopy of the agent's ID card.
  • Opening of the legal person institution: The business license and photocopy of the legal person shall be provided; the legal representative certificate; the original and photocopy of the securities account card; the original and copy of the legal person's power of attorney and the authorized person's ID card; Also need to provide overseas business registration certificate and director's certificate
  • (2) Fill in the account opening information and sign the "Securities Sale Entrustment Contract" (or "Securities Entrustment Agreement") with the Securities Business Department, and sign the "Designated Transaction Agreement" for the Shanghai Stock Exchange.
  • (3) The securities business department opens a fund account for investors
  • (4) Investors who need to open the function of the bank transfer business of the securities business department, pay attention to the instructions of the securities business department regarding the use of such business functions.
  • Choose a trading method
  • While opening an account, investors need to choose the trading methods and access methods they use in the future, and sign the corresponding opening procedures and agreements with the securities business department. For example: telephone entrustment, online trading, mobile phone stock trading, bank transfer Wait.

Yinzhentong[edit]

  • Opening the "Silver Pass" requires going to the bank to go through the relevant formalities.
  • The account opening steps are as follows:
  • 1. Bank outlets to open an account: Hold a valid ID card, the bank's same name savings passbook (if no, can be opened on the spot) and the Shenzhen and Shanghai shareholder code cards to the bank outlets that have opened the "Bank of China" business to open an account.
  • 2. Fill in the form: Fill in the "Securities Entrustment Agreement" and the "Golden Securities Entrustment Agreement".
  • 3. Set the password: After the form has been verified, enter the transaction password on the spot, and receive the agreement client. You can query and commission the transaction.

B-share account opening[edit]

  • The first step: with the valid identity document to the original foreign exchange deposit bank to transfer its cash deposits and foreign currency cash deposits to the securities firm in the same city, peer B-share margin account. Domestic commercial banks should issue credits to domestic residents. Single, and issue a statement to the securities institution;
  • Step 2: Open a B-share fund account with the valid identity certificate and my account voucher to the securities institution, and the minimum amount for opening the B-share fund account is equivalent to US$1, 000;
  • The third step: With the newly opened B-share fund account, apply to the securities trading institution to open a B-share stock account.
  • Shenzhen B shares account
  • As the legal registration agency of Shenzhen B shares, China Securities Depository and Clearing Corporation Shenzhen Branch is responsible for the B-share investor opening business. At the same time, it is authorized to some securities business departments, and some banks or other agent account opening accounts open B-share accounts. Current online real-time B The opening of the stock allows domestic and foreign agents and overseas agents to open accounts. Some securities business departments act as Shenzhen B-share account brokers, and can also act as agents for B-share accounts. Investors can go to the B-share business of Shenzhen Stock Exchange. Qualified securities business department, the account opening agency entrusted by Shenzhen Stock Exchange handles B-share securities account. Account opening:
  • 1. Domestic individual investors are required to submit:
  • (1) A voucher of foreign exchange funds with an amount of HK$7, 800 (equivalent to US$1, 000) and a copy thereof;
  • (2) Domestic resident ID card and its copy.
  • Note: Domestic individual investors must apply for B-share account opening personally, and may not be handled by others. Domestic legal persons are not allowed to open B-share accounts. Foreign individual investors may entrust others to act on their behalf, and each investor can only open one account.
  • 2. Foreign individual investors are required to submit: Overseas ID card or passport, other valid ID documents and their photocopies.
  • 3. A foreign institutional investor must provide: a business registration certificate, a power of attorney, a certificate of identity of the director and a copy of it, the identity document of the manager and a copy of it.
  • Account opening fee: 120 Hong Kong dollars per household; institutional investors 580 Hong Kong dollars per household.
  • Shanghai B-share account opening
  • With the B-share fund account certificate, members of the Shanghai Stock Exchange who are qualified to operate B-shares in China apply to open a B-share stock account. When opening an account, you must submit:
  • I have a valid identification document, a bank entry voucher of more than US$1, 000, an application form for the Shanghai B-share domestic resident account opening registration, and other materials that the Shanghai Stock Exchange and the registration company believe need to provide.
  • Account opening fee: If a domestic resident individual opens a B-share stock account, the handling fee shall be paid according to the regulations. The handling fee shall be charged according to the standard of 19 USD/household.
  • Securities Business Department B shares account
  • The investor opens a B-share margin account in the securities business department of the securities company:
  • Investors must provide the original and a copy of the following documents, and sign all relevant account opening documents, reserve a seal or password:
  • (1) B-share shareholder account confirmation (ie B-share code card);
  • (2) The valid identity certificate of the individual or the effective business license of the institution and the authorized agency letter signed by the legal representative of the institution and the identity document of the agent;
  • (3) The head of the account opening account gives the agent a certificate of various authority;
  • (4) The Shanghai Stock Exchange must handle the designated transaction.

Related links[edit]

  • Once the issued shares are listed, they enter the secondary market. Investors buy and sell stocks according to their own judgments and needs. The transaction price is determined by the buyer and the seller. The price of the investors buying the shares on the same day is different. The secondary market is closely related to the primary market (primary market) and is interdependent and mutually constrained. The types of securities provided by the primary market and the types and types of securities issued by them determine the size of the securities in the secondary market. Structure and speed, while the secondary market, as a place for securities trading, plays an active role in promoting the primary market. The well-organized, well-managed, well-served secondary market distributes the securities issued in the primary market quickly and efficiently. Transfer, make it flow to other more needy, more appropriate investors, and provide real possibility for the realization of securities. In addition, the supply and demand situation and price level of securities in the secondary market will have a strong impact on the primary market. The issuance of securities. Therefore, without a secondary market, the issuance of securities is unlikely to proceed smoothly, and the primary market is unsustainable. It is even more impossible to expand the issuance.

Videos[edit]

Webinar - secondary market

00:00 hello this is Joe from prep agent and I
00:03 am here today with Carol a new student
00:06 getting ready to pass a real estate exam
00:08 hello Carol hi Joe how you doing pretty
00:12 good not as good as you say you are B's
00:14 you're a little nervous you call me a
00:16 little bit of panic right well yeah
00:18 exactly this isn't the most fun stuff in
00:20 the world but I got to do it you got to
00:22 do it but we'll make it a little less
00:24 painless and we're going to focus on the
00:25 top that was giving you a little trouble
00:27 and what topic is that um the real
00:33 estate game the secondary market yeah
00:37 yes don't worry about it I know the
00:41 whole exam could be daunting but we were
00:44 talking about the secondary market
00:45 before okay and a lot of people do
00:49 because when you study other stuff like
00:51 appraisal it's much more tangible you
00:53 see the properties the definition is a
00:55 little simpler secondary market is very
00:57 ambiguous to people it's not something
01:00 your average person comes across so it's
01:03 a little harder for people to wrap their
01:05 head around but we're going to try and
01:07 make it a little more manageable for you
01:09 today
01:09 so you can move forward it's less
01:11 daunting on your real estate exam okay I
01:14 appreciate it thanks yeah no worries
01:16 um and let's now down our points of
01:19 trouble from real estate exam to more
01:21 specific things what do you think okay
01:23 okay so first thing first piece of
01:27 advice to give everybody don't overthink
01:29 stuff remember my motto smart is
01:32 overrated you don't want to overthink
01:34 everything keep it simple keep it easy
01:36 keep it concise you could get very
01:39 involved with the secondary market but
01:41 there's just a few simple things you
01:43 need to know and it all starts with this
01:45 the secondary market is the resale
01:50 market place of loans do you read that
01:53 back to me the secondary market is the
01:56 real resale market of loans do you know
01:59 what that means
02:00 oh not really doesn't matter if you see
02:03 that circle it on your exam okay you
02:07 know what it means just circle it
02:09 because that is the core of it now I'm
02:11 going to explain a little bit what it
02:13 mean
02:13 means but this is the core of everything
02:15 so remember it like it's Greek or
02:17 whatever language you don't know this
02:19 secondary market is the resale market
02:21 place of loans hey are you a history
02:24 buff in some areas ok so sometimes
02:29 knowing that history or something
02:31 will really help explain the concepts so
02:35 let me take you back to 1934 tell me
02:40 what you know about 1934 the Great
02:44 Depression there you go you're on a roll
02:46 Great Depression yeah what do you think
02:49 now you obviously don't know this much
02:51 detail but you're smart person what do
02:53 you think real estate wise is going on
02:55 during the Great Depression ah my guess
02:58 would be hard times
03:00 deflation ok so really it was a society
03:05 full of renter's and what I mean by that
03:09 only the very rich could own property so
03:13 most of the society had to rent and as
03:16 you go into real estate you know that to
03:18 build wealth you want to own property so
03:20 as a classic case of the rich getting
03:21 richer and the poor just struggling to
03:24 keep up these as we know poverty could
03:26 be like quicksand and part of that is
03:29 paying exorbitant rents trying to keep
03:31 up where you're not getting any money
03:32 back through an equity building and the
03:35 appreciation of the property so that was
03:38 part of the problem of Great Depression
03:39 let me get a little more specific back
03:43 then to get a property you have to put
03:46 down twenty to forty percent on the
03:49 property twenty to forty percent that's
03:51 a lot of money think about terms today
03:53 we don't put nearly that amount down on
03:56 a property true yeah and the loan amount
03:59 was seven years so it was a seven year
04:03 loan and it was a straight note okay I
04:06 mean you only play the interest seven
04:09 year loan so if you think about it
04:12 what's the issue with that the issue is
04:17 most people can't afford it yeah so most
04:19 poor people can't afford about twenty
04:21 forty percent down even today that would
04:23 it be realistic yeah I wouldn't be able
04:25 to do it either yes
04:27 case 20 40 % was a large down payment
04:30 and in seven years the bank would have
04:33 the money back so what does that mean
04:36 that means the bank had money to lend
04:39 out over and over again remember they
04:41 were getting 20 40 % down and the loans
04:44 were being repaid back after seven years
04:46 okay though it worked for the banks they
04:49 keep lending to the rich people could
04:51 afford to take out the loans but the
04:52 lower class and the poor was left out
04:54 this made things a lot worse and it
04:58 helped a tribute to the Great Depression
05:01 so what happened was in 1934 he had
05:07 1930-31 Thor to remember Shirley Temple
05:10 you were a big fan of hers right yeah
05:12 she's kid yes 1930s 1934 something
05:17 happened in the real estate world very
05:19 excited you know what it was know
05:22 something called the FHA never heard of
05:25 the FHA I certainly have yes it's
05:28 probably something you saw in your books
05:30 for you're like what's that about I've
05:31 heard of it but I don't exactly know
05:33 what it is okay so what the FHA did is
05:36 they stepped it and this is a government
05:38 organization it said we got to do
05:40 something about this is getting out of
05:41 control depressions going crazy so what
05:45 the FHA did is they decided to insure
05:48 the lenders from loss they told the
05:52 lenders hey instead of doing this seven
05:54 year twenty to forty percent why don't
05:56 we do something more reasonable like
05:58 three percent and why don't we do it
06:01 over the course of oh no 30 years which
06:05 is more what you see today that 30 year
06:08 loan the banks were like well that's
06:11 crazy we won't have money to lend out
06:13 what if people default an FHA said no
06:15 worries we will insure you from loss so
06:18 if anything happens we got you covered
06:21 but in doing that a new problem arose
06:24 what do you think so now banks were
06:27 collecting so you want to get a house
06:28 you gave me three percent and you're
06:32 going to pay me back over thirty years
06:34 okay where it used to be I would get the
06:37 money over seven-year period so
06:41 what's the issue for me now as the
06:42 lender whether in the Great Depression I
06:46 keep a job for that amount of time and
06:48 consistently pay well that's what the
06:51 FHA said they would help ok another
06:53 issue here for me is the bank as a
06:55 business remember before I was getting
06:57 20 to 40% down payment and I was getting
07:01 all my money back in seven years yeah on
07:03 the next guy wanted to borrow money
07:05 wasn't an issue for me now I'm lending
07:09 money to people who aren't paying me
07:10 back in 30 years so what's my issue
07:15 having enough of a having enough to loan
07:19 exactly there you go
07:21 so now I don't have the money to lend
07:24 out to the next guy
07:26 so my business model is kind of screwed
07:29 by this you know the FHA all right
07:34 insure the lenders from loss now keep
07:36 note FHA is not a lender they just
07:39 insure the lenders from loss but what
07:42 the Sid has created a situation where I
07:44 lost capital I don't have capital to
07:46 lend out to new people does that make
07:48 sense yeah it does okay so this is where
07:54 the secondary market came in the
07:57 secondary markets the resale market
07:59 place they would buy those loans from
08:03 the FHA okay or by excuse me by those
08:06 FHA insured loans
08:07 I just say that correctly resell them
08:09 and now the lenders have the capital to
08:13 lend money okay does that make sense
08:16 make sense and now you know why when I
08:20 started this lesson I said think of it
08:22 as the resale market place okay so
08:26 essentially I could lend you money and I
08:29 need the money back so I'll resell that
08:31 loan to the secondary market they could
08:35 wait to make money over a longer period
08:37 of time over 30 years and the complex is
08:39 in the stock market they buy it and now
08:42 I have the money to lend out to new
08:45 people how good yep now the FHA insured
08:50 the lenders from Lawson FHA made it very
08:53 desirable loan to Reese
08:55 on the secondary market is insured but
08:56 to do that they do verify the borrower's
08:58 employment have the property appraised
09:00 by a neutral third party and have a
09:02 title search which shows the history of
09:04 ownership okay
09:08 borrowers charge a one-time upfront
09:10 insurance premium and if the borrower
09:12 default it the FHA would pay the
09:15 difference key point here FHA does not
09:18 make loans you don't go to an FHA office
09:20 to get a loan there's no such thing FHA
09:23 is an insurance place for lenders okay
09:27 okay so I hope part of this background
09:30 puts it a little more in context for you
09:32 because in the secondary market yeah
09:35 okay 1939 Fannie Mae bought it FHA
09:41 insured loans from lenders this is a
09:43 government institution and you ever
09:46 heard of the VA yeah
09:48 what's the VA Veterans Association yeah
09:52 so the veterans return for 935 fannia
09:54 meg agreed to buy VA guarantee loans the
09:57 lender had negotiated Fannie Mae buys
10:00 mortgages on the secondary market
10:01 closing together then sells them back as
10:04 mortgage securities to investors in the
10:06 open market that's a little more
10:08 complicated way of saying what I was
10:10 saying before how they take the loans
10:12 they create them sell them on the
10:14 secondary market and then they have the
10:16 capital in order to make more loans okay
10:20 yeah I get it you're going to hear a
10:23 term called warehousing have you heard
10:26 this term before
10:27 no warehousing is when they packaged the
10:30 loans and sell them in a group kind of
10:34 like when you buy a six-pack of soda
10:35 what's cheaper buy a six-pack of soda or
10:38 buying six individual sodas six-pack
10:41 right so warehousing is like a six pack
10:44 of sodas okay okay and they sell on a
10:47 secondary market they package loans they
10:49 sell them all is what Ginnie Mae is a
10:56 federally owned corporation Department
10:58 of housing Urban Development and they
11:00 insure liquidity do you know what the
11:02 word liquidity means um I I think in
11:06 terms of if you liquefy whatever you
11:08 on what it's worth yeah it's basically
11:13 turns things into cash right makes the
11:16 money more movable just saying the word
11:18 liquid what is the liquid mean to you
11:20 when you think of the word liquid well
11:22 Flo exactly it moves easily so when you
11:26 think of Lee couldn't be for money just
11:27 think of it like liquid it flows easily
11:29 it could be easily moved in summary
11:35 secondary market resells loans - which
11:37 help provides fun for lenders oh my gosh
11:39 please excuse my spelling error
11:41 everybody sees this you do not smell
11:43 resale with an L in there okay
11:47 disclosure I've identified my error so
11:50 don't won't put all the comments on
11:51 YouTube please Cal to see any other
11:54 errors here so people don't trash me on
11:57 YouTube oh let's see secondary market B
12:01 sells loans to which help - which helps
12:03 provide funds for lenders I come put a
12:05 period on the end but on that we're okay
12:07 see how smart I am
12:09 you think I misspelled but really I just
12:11 made you reread that sentence for
12:13 everybody watching this on uShip okay
12:15 see that was all pre thought so haha
12:18 everybody on YouTube leg okay here's
12:23 your favorite part questions did it a
12:27 done so unfortunately we're going to
12:30 expose your weakness but I want to
12:32 congratulate you these by you expose
12:34 your weaknesses or helping a lot of
12:35 people including myself as a teacher and
12:37 other people trying to learn and I'll do
12:40 these questions with you so I'll help
12:41 explain concepts as we're working on
12:43 them okay all right so just do your best
12:46 and don't be afraid to get it wrong
12:48 because we rather get it wrong now than
12:51 on your exam fair enough
12:55 all right why don't you read this out
12:58 loud in which of the following markets
13:01 may a lender sell alone that a mortgage
13:03 banker is previously originated hmm
13:08 secondary market
13:10 look at you you already do well 100%
13:14 okay why is your circle secondary market
13:18 because that's what we've been talking
13:20 about what I'm getting at I'll say
13:22 a lot as you prepare for your exam if
13:24 something is familiar to you Circle it
13:27 do never circle things that you've never
13:29 heard of before these if you study a lot
13:32 for this exam you're going to see things
13:34 that become familiar if something in
13:36 your exam you've never seen before that
13:38 means it's not in your material you
13:40 don't need to know it
13:41 don't circle it okay okay
13:48 okay which of the following markets may
13:50 a letter sell alone that a mortgage
13:52 bankers previously originated what's the
13:54 answer
13:54 secondary market boom okay great
13:58 a VA loan may be granted for the
14:06 purchase of a one to four family okay
14:25 okay vlo may be granted for the purchase
14:28 of a one-family - for family property if
14:31 what do you think
14:32 um the down payment will be at least 10
14:42 percent nope so the answer here is the
14:45 veteran agrees to live there we do not
14:47 talk about that in the lessons you don't
14:49 true we get it I guessed right so don't
14:52 feel bad about getting that wrong okay
14:54 what I want you to learn from this is
14:57 you're getting tested primarily on
15:00 residential real estate okay so remember
15:03 that people live in residential real
15:06 estate the VA insures loans but they're
15:10 not insuring loans so people can make
15:12 money they're insuring loans so people
15:14 have a place to live it's making sure
15:17 veterans have a whole not making sure
15:19 veterans can get nice income properties
15:21 and things of that nature okay all right
15:24 I default to answers on your exam will
15:27 usually revolve around people's
15:29 residents not collecting rent or things
15:32 of that nature now that's not always the
15:34 case but it's a good rule of thumb to
15:35 follow as you prepare okay I'll remember
15:38 that okay so with that being said what's
15:44 the answer here going off what I just
15:45 explained to you which the farm loans be
15:49 most likely to qualify for FHA insurance
15:54 it would be a loan to purchase one to
15:58 four units of residential rental
16:00 property right and what we're getting at
16:01 here we didn't talk about a lot about
16:03 that but going off that rule of thumb I
16:06 just gave you you're saying you know I'm
16:08 not sure here but going off that rule of
16:10 thumb a residential real estate there it
16:12 is that's exactly what I did yeah and so
16:15 they'll really help you as you prepare
16:16 for your exam which of the following
16:23 stated is most accurate concerning
16:24 mortgage bankers ah
16:32 they negotiate loans which are readily
16:35 saleable in the secondary mortgage
16:37 market you've got another one right I
16:40 want you to remember you said you knew
16:42 nothing when you started this lesson
16:43 true it's either I'm a great teacher or
16:47 you need more confidence let's go with
16:49 both okay
16:58 lenders who deal directly with the
17:00 borrowers make up the what do you think
17:03 um probably do the primary mortgage
17:11 market I love that you got that right
17:12 you didn't automatically circle
17:14 secondary market because you paid
17:16 attention and you said secondary markets
17:18 the resale market place so that's not
17:20 dealer directly borrowers so the primary
17:23 mortgage market is the answer there
17:25 that's exactly how I thought excellent
17:29 what you're also learning is in order to
17:32 pass this exam if you know as few simple
17:35 rules of thumb and you know some key
17:36 words and know some key concepts you
17:39 could get by and you'll be okay so as we
17:42 started with you and started this lesson
17:44 there's a feeling of insecurity and my
17:46 hope as you're doing this you get a
17:47 little more confidence saying you know I
17:49 can handle this if I just understand
17:50 some important concepts that are
17:52 relevant to what we're doing here which
17:59 of the following loans on a home would
18:00 probably be made without requiring a
18:02 down payment from the borrower ba I
18:08 don't know how you got that right but
18:10 you did va that's well as you just gotta
18:14 learn VA does not require a down payment
18:16 20 Raza T we didn't I did not say that
18:19 in the lesson how did you come up with
18:21 VA what was your thought process well we
18:23 were talking about the previous question
18:25 and the and the that the idea was just
18:30 to give someone a residence and we were
18:32 talking about veterans so in a way it
18:33 was an educated guess that the veterans
18:36 that this would apply to the veterans
18:38 excellent good so the other thing you
18:43 see is GN mas Ginnie Mae we learned
18:46 before they buy things on the secondary
18:49 market right okay yeah conventional we
18:52 haven't heard that word we didn't write
18:53 that today
18:55 FHA you learnt about right so then
18:59 remember I said FHA doing a small down
19:01 payment I told you that story
19:03 originators 20 40 percent
19:05 I didn't say FHA said no down payment I
19:07 said it was much smaller down payment
19:08 okay and so you came up with the yet
19:12 right primary activities of Fanny man
19:21 the secondary market involves which one
19:23 um FHA loans only government insured and
19:33 guaranteed loans which FHA is one off
19:36 all right just for the record this was
19:39 your exam you are passing your exam so
19:42 far okay you like that little animation
19:47 there yeah
19:56 Benny May federal National Mortgage
19:58 Association primarily created to say
20:03 um let's see it would be it would either
20:12 be a or C so increase the availability
20:14 of secondary financing or serve as a
20:16 secondary mortgage market I think I'm
20:19 going to go with a you're so close
20:25 increase the availability of secondary
20:27 financing that increased the people like
20:30 on the stock market's ability to pie
20:32 things there's nothing do with them okay
20:34 so it serves as a secondary market but
20:36 your thing is great right the keyword
20:38 was mortgage market okay got it
20:40 I see where I messed up all the follow
20:48 considered Irv edges of FHA except um
21:00 the achieve um the buyers protected with
21:05 FHA insurance you are doing awesome
21:09 why'd you answer that one because it's
21:13 the lender that's protected by the FHA
21:15 insurance I'm so impressed with you that
21:19 is great and you swear when we started
21:22 that you said you do nothing about the
21:23 secondary market correct correct
21:26 what you're killing it purchaser were a
21:33 home five years ago is now interested in
21:35 securing an FHA loan a sales person most
21:37 likely introduce the homeowner to UM a a
21:47 conventional bank or savings alone right
21:49 again please remember the FHA is not a
21:53 lender and razor you know doesn't make
21:55 loans and what's the Federal Home Loan
21:59 Bank I don't know that that's a jackal
22:01 it that's exactly how I got that answer
22:04 you are going to be a real estate
22:06 licensed professional
22:09 without knowing anything about this
22:11 stuff term words warehousing refers to
22:23 what let's see oh um I think I'm it's
22:36 either A or B let's see um I'm gonna go
22:41 with B selling loans yep
22:56 secretary mortgage market is the market
22:58 in which promissory notes are exchanged
23:00 which of the following is not considered
23:02 a major plan this secondary mortgage
23:04 market uh Sallie Mae great we haven't
23:16 heard that name before that's why rules
23:18 of thumb so you're part learning new
23:21 information you're part learning test
23:23 taking techniques here yes yes exactly
23:33 Ruby respond for paying the 1%
23:36 origination fee on an FHA loan see the
23:40 buyer yep what's your goal to learn or
23:48 pass to pass pass yes learnings neigh
23:52 and learning later well learning
23:54 experience that's when it really sticks
23:56 yes and obviously do I want me to learn
23:58 of course I do I'm just kind of joking
24:00 with that but really we want to get past
24:02 the exam and you're doing such a great
24:05 job of seeing you know I don't really
24:07 know this stuff there's a few key things
24:09 that if I understand I'm going to pass
24:10 without really having an in-depth
24:12 knowledge of this material when you're
24:15 really doing well with that do i watch
24:17 it in depth knowledge obviously I do but
24:20 that may not be realistic before you're
24:23 dead yeah that will come organically
24:24 with the first year experience yes
24:27 exactly
24:30 borrow bought a 74 thousand dollar house
24:33 no downpayment the loan was probably
24:35 what a VA loan done going with logic
24:43 here you'd say out of this group who is
24:45 the most likely to earn of a no
24:48 downpayment loan a veteran exactly yes
24:58 when purchasing with the FHA financing a
25:00 new buyer would normally do each the
25:01 following except what see who applied to
25:09 a local FHA office remember the buyers
25:12 don't go there okay now what I think you
25:18 just answer to quickly a correct
25:26 statement about the federal National
25:27 Mortgage Association is that it is you
25:32 think okay that it provides guarantees
25:37 to lenders on certain mortgages no
25:43 purchases certain mortgages originated
25:45 by lending institutions right yeah that
25:48 one I went with the for the answer
25:49 before I read all of them and then when
25:51 I read the fourth one I realized it fit
25:53 more ya know was okay term warehousing
26:02 and use the real estate financing means
26:04 what a mortgage company collecting loans
26:10 prior to recent excellent do you
26:11 remember my soda example yes I did
26:19 FHA was primarily created for what
26:22 reason to provide what let's see ah
26:33 insurance for home loans made by proved
26:36 lenders killing it you're so good
26:39 oh reading which statement best
26:49 describes VA low okay you got to give me
26:52 a minute to read this well if you skim
26:55 through it
26:56 okay good things that just stick out all
27:00 right I am right now so what sticks out
27:05 to your skin feel that it would be it
27:07 would be D alone funded through the US
27:08 Department of Veterans Affairs for
27:10 qualified veteran on approved properties
27:12 okay um so use one of two there's either
27:18 a or D yeah what should what I was
27:21 saying skimmed through it is veterans
27:24 the other two deemed have veterans as
27:26 part of the answer VA loans clearly for
27:28 veterans so I could have narrowed it
27:31 down to a and D he went with D a is
27:33 correct but you're still you're thinking
27:35 was in the right path right and I didn't
27:37 actually get to when I was skimming I
27:39 did not get to with no down payment
27:41 required or I would have picked I would
27:43 have picked a excellent good you should
27:49 get this really quickly as I think I
27:51 actually asked this one before okay
27:59 selling loans on the secondary market
28:01 excellent good this you should get this
28:08 one very quickly VA loans unique feature
28:11 about the payments which are required is
28:13 there may be no down payment boom so now
28:18 what's happening you're starting to
28:19 recognize key words yes buyer who wants
28:26 to FHA loan to refer the buyer directly
28:28 to ah D and any approved lending
28:37 institutions such as a bank or savings
28:38 and loan association good
28:47 excellent so you did awesome today super
28:50 happy with you super with what you
28:52 accomplished today I hope you're happy
28:55 too
28:55 do you feel like you learned slang today
28:57 yeah thanks Joey you're a great teacher
28:59 I really appreciate it
29:00 thank you thank you should tell my
29:02 sister that she's always criticizing me
29:04 I will yes so what did we gain from
29:10 today not only with the lesson about the
29:13 secondary market but first I hope you
29:15 gain some confidence with this I didn't
29:17 and I want you to think about how you
29:20 did on those questions and what's the
29:22 first thing you said to me it's recorded
29:24 so don't don't go back on it when I
29:26 asked you what are you having trouble
29:28 with would you say the whole question
29:31 holds it and I said what do you know
29:33 about the secondary market what you say
29:34 nothing nothing and after doing this I
29:37 think you realize hey I know more than I
29:40 think I did yeah I do and I can make I
29:44 can certainly make educated guesses and
29:47 as you say I can use some of the key
29:48 words and I'll get a certain percentage
29:51 of them correct good so just remember
29:53 keep it concise keep it simple you'll do
29:57 great
29:57 and it's Jo prep agent calm and good
30:01 luck everybody let me know if you have
30:02 any questions and leave comments on the
30:05 bottom of the YouTube page okay okay
30:08 thanks Jo

This "Webinar - secondary market" video is published on 3 Jun 2015 by Prep Agent under Education category on YouTube (with 37,586 views, 436 likes, 16 dislikes and 48K subscribers on 23 Aug 2018).

The key difference between Primary Market vs Secondary Market

00:00 hello and welcome to our online classes
00:05 in this video I want to talk about a
00:10 difference between primary markets and
00:14 secondary markets okay in our first
00:20 video we had spoken about what exactly
00:23 are capital markets and then we had
00:27 broadened our discussion and talked
00:29 about what were financial markets in
00:31 this video I would like to talk about a
00:35 very important difference or a
00:37 classification in the capital markets
00:42 namely the primary market and the
00:44 secondary market and then in this video
00:47 I want to talk about the topics that we
00:52 are going to cover extensively in the
00:55 future videos in this series of lectures
00:59 okay
01:01 now primary markets well as we had
01:06 spoken about in our first video capital
01:09 markets is a way for institutions or
01:15 companies to raise capital right so a
01:19 company will issue securities and
01:23 investors will buy those securities and
01:26 will provide capital okay so that's what
01:29 a capital market was mostly mostly for
01:34 now a primary market is a market where
01:38 the company is directly participating in
01:41 the market and is issuing new securities
01:46 to investors and investors are buying
01:49 those securities not these securities
01:51 could be debt or equity we will cover
01:56 these terms in later videos definitely
01:59 so in that companies could issue new
02:02 debt or equity or a combination of the
02:05 boat and investors can buy those
02:08 financial securities and provide capital
02:10 to the company
02:12 examples of
02:13 Maree market operations are IPOs which
02:16 are initial public offerings or NCDs
02:20 which are non convertible debentures an
02:24 IPO is a part of equity or debt is a
02:27 type of sorry NCD is a type of a debt
02:30 financial security but the common thing
02:33 about all these is that these are new
02:36 financial securities that have been
02:38 launched by the company to raise fresh
02:41 capital okay fresh capital but then what
02:49 is the secondary market well suppose a
02:52 company doesn't IPO and it issues new
02:58 shares right and you as an investor buy
03:05 those new shares from a company say XYZ
03:09 corporation okay you as an investor you
03:12 participate in the IPO and you buy the
03:15 new shares that are offered by XYZ
03:19 corporation now suppose one month or two
03:23 months down the line you as an investor
03:26 are in need of cash and you want to sell
03:30 your financial securities you want to
03:31 sell the shares of XYZ corporation how
03:35 can you do that well you can go to the
03:38 XYZ corporation company and tell them
03:41 look I might need for some cash I would
03:44 want you to buy the shares from me
03:48 well XYZ corporation could end up
03:51 telling you look we have a project
03:55 coming up which is capital intensive we
03:58 have to invest a lot of money in the new
04:00 project hence it will not be possible
04:02 for us to buy those shares from you as
04:04 an investor what could you do that well
04:09 the only option left for you is that you
04:11 have to go to somebody else another
04:14 investor who is willing to buy those
04:17 shares from you right but wherever you
04:21 find an investor like this who is
04:23 willing to buy the shares of XYZ
04:25 corporation
04:27 from you and provide you with cash oh
04:30 that's where the secondary market comes
04:32 into the picture the stock market which
04:36 is a prime example of the secondary
04:38 market is a market where two different
04:40 investors participate to buy and sell
04:44 financial securities please note that
04:47 the company whose shares are being
04:49 traded in the secondary market need not
04:52 be a participant in the market so the
04:56 investor a as we can call him here and
04:59 rest of B as we can call him here may
05:02 not be related to the company they might
05:04 be two different investors two
05:06 independent investors who have a view on
05:09 the company and want to either take up
05:12 ownership or relinquish ownership of XYZ
05:16 corporation well why the term secondary
05:19 market well because the shares which are
05:22 being traded in the secondary market are
05:24 sort of second-hand aren't they because
05:29 you who had participated in the IPO of
05:33 XYZ corporation when you sell the shares
05:36 to another investor say investor B you
05:40 are in a way selling secondhand right
05:44 well that whether it's first hand or
05:48 whether its second hands has absolutely
05:49 no impact in the market for financial
05:53 securities but that's where the term is
05:56 actually coming from okay so one
05:59 important thing to note is that most
06:02 people who are new to stock markets
06:05 don't actually realize that the money
06:08 that they are putting in to buy shares
06:10 in a stock market is not directly going
06:14 to the company it does not reach the
06:15 company right it is actually going to
06:19 the investor who is willing to sell the
06:22 shares or the investor to the investor
06:24 who is willing to sell the shares it is
06:26 he who gets the money so when you
06:28 participate in a stock market you are
06:30 not sending money directly to the
06:33 company the company has already raised
06:34 its capital why are the IPO or whatever
06:38 news financial security there
06:41 they have issues in the primary market
06:42 okay so this is a key difference or a
06:46 key classification of the capital
06:48 markets naming the primary market and
06:51 the secondary market okay
06:54 now I also want to talk about what we
06:57 are exactly going to cover in the
06:59 capital markets in the future videos
07:01 under this topic okay the first thing
07:06 that we are going to talk about in
07:07 future videos is going to be initial
07:10 public offering or IPO s okay
07:13 now I POS is a primary market operation
07:16 its primary market where a company
07:22 issues new shares to investors okay and
07:27 investors buy those shares and provide
07:29 the company with capital okay now we are
07:33 going to look into some important issues
07:36 of questions while we cover this topic
07:39 of IPO we're going to look into the
07:41 reason why companies do IPOs because if
07:44 a company needs capital it can always go
07:47 to the bank and ask for a loan right why
07:50 does it need to go directly to investors
07:53 to raise capital well there are some
07:55 advantages of doing that and that is
07:57 what we are going to cover in the future
07:58 videos then we're going to talk about
08:00 some disadvantages of doing an IPO of
08:03 course there are some disadvantages of
08:05 doing IPOs and we would like to point
08:07 out what they are then we're going to
08:10 talk about the process of an IPO in
08:12 India what does the company need to do
08:16 to raise capital via an IPO why are any
08:21 initial public offering then finally we
08:24 will look into some important terms or
08:26 jargon in the IPO and then we're going
08:30 to look ask the question what you as an
08:34 investor should be looking into before
08:38 you decide to invest in an IPO okay and
08:43 the next thing that we are going to talk
08:45 about in this series of videos is stock
08:50 markets well of course that's what this
08:52 course is about it's about Stockmar
08:54 it's and we're going to explain what
08:55 exactly is a stock market we will cover
09:00 a few concepts within those videos we
09:03 are going to answer the question what is
09:05 the Nifty and the Sensex
09:07 okay not many people who are new to the
09:11 world of stock markets don't exactly
09:14 understand what is exactly the Nifty and
09:16 the Sensex and how it is calculated okay
09:19 so we're going to answer that question
09:20 in details we're also going to look at
09:23 the various types of the different the
09:27 different stock markets in India well
09:29 there are many stock markets in India
09:30 the most two popular ones are NSE the
09:34 national stock exchange and BSE the
09:36 Bombay Stock Exchange but there are
09:38 other stock exchanges as well like
09:40 calculus Stock Exchange or the multi
09:43 Commodity Exchange stock-exchange the MC
09:46 x sx so we're going to talk about the
09:49 different stock markets in India and
09:51 what are the pros and cons of various
09:54 stock markets okay
09:56 finally we're going to look into some
09:58 rules within the stock markets in India
10:01 called circuit breakers a certain
10:04 because are a set of rules that are
10:06 applied to stock markets in India and we
10:09 are going to cover that because you as
10:11 an investor or a trader in stock market
10:14 need to be aware of what and how the
10:18 circuit breakers work okay
10:20 so these are the things that we are
10:22 going to cover in the future videos in
10:24 this topic till then goodbye and good
10:28 luck

This "The key difference between Primary Market vs Secondary Market" video is published on 25 Jul 2015 by Elearnmarkets.com under Education category on YouTube (with 41,450 views, 264 likes, 12 dislikes and 55K subscribers on 23 Aug 2018).

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More info[edit]

  • Search for more info on Secondary Market.
  1. Secondary Market
  2. Features of secondary market
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  5. Secondary market ppt
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  7. Secondary market pdf
  8. Role of secondary market
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References[edit]

  1. ^ Wang Chongrun. Financial Market Studies: Higher Education Press, 2014
  2. ^ Impact of IPO restart on secondary market. . Date of reference 2014-02-07