What is the main function of secondary markets

The secondary market is any place that people trade securities (financial items that have monetary value, such as stocks and bonds) after initial public offering. It contrasts with the primary market, in which securities are sold for the first time. For example, the New York Stock Exchange (NYSE) is generally a secondary market for shares of equity in companies. The initial public offering (IPO) is the first sale of shares. From there, traders exchange those shares with one another in the secondary market. While the IPO is a way for the company to raise capital , trades on the secondary market update the current market value of that stock. When the United States federal government wants to raise money, it periodically issues debt instruments. For example, it might offer a 30-year U.S. Treasury Bond that pays $100 at maturity, plus a 1.5% interest rate . When the Department of the Treasury auctions these bonds off, the proceeds go toward paying for government services. But the buyer doesn’t have to hold the bond for 30 years. At any point along the way, they can resell that bond on the secondary market. The secondary market is like re-gifting a present at Christmas… When the office decides to do a secret Santa, everyone brings a small present. One option is to go to the store and buy something nice. But another choice is to give something away that you already own. You could just re-wrap the present you got last year. Similarly, bringing something to the secondary market is...