The securities markets can be divided into the primary markets and the secondary markets. Primary markets comprise new securities sold to their first holders. The issue of new securities is commonly known as an IPO (see lesson 31).
Secondary markets often consist of stock exchanges (see lesson 28). The International Securities Market Association (ISMA) is the trade association for the banks and other investment institutions that are active in the secondary markets.
In the primary markets, securities may be offered to the public in a public offer. Alternatively, they may be offered privately to a limited number of persons in a private placement. Often a combination of the two is used. The distinction between the two is important to securities regulation and company law.