Series 14: 6.1.3. Types Of Securities Offerings

6.1.3. Types of Securities Offerings

When a company issues and sells new shares to the public, it is called a primary offering. The proceeds of a primary offering go to the issuer of the securities and are therefore part of the primary market. Recall from Chapter 1 that the primary market consists of sales by issuers to investors, whereas the secondary market consists of sales between investors. As mentioned previously, the first public offering of shares by a company is called its IPO. If a company