Primary market

Imagine you really love collecting toys, and you want to buy the newest toy from the store. The store is like the primary market. It's the place where new toys are sold for the first time. This means that you are the first person to own this toy.

Similarly, the primary market is where new stocks or shares of a company are sold for the first time. Here, companies sell their stocks directly to investors like you. This means that you can own a part of the company by buying its stocks.

The companies do this because they need money to grow their businesses. They usually sell their stocks to raise money to expand or invest in new opportunities. The money you pay for the stocks goes directly to the company.

In summary, the primary market is where new stocks or shares are sold for the first time by a company. It's like buying a new toy from the store where you are the first owner of the thing you bought.