Which market is known for the initial sale of securities?

The primary market is recognized for the initial sale of securities. This is where companies issue new stocks and bonds to investors for the first time, often as a means of raising capital for various purposes such as expansion or operational funding. Investors in the primary market essentially purchase these securities directly from the issuing entity, which allows the company to benefit immediately from the funds raised.

In contrast, the secondary market is where previously issued securities are bought and sold among investors. Neither the issuing company nor the initial funds raised are involved in these transactions. The over-the-counter market involves the trading of securities directly between parties and can include both primary and secondary market transactions, but it is not specifically focused on initial sales. The capital market encompasses the mechanisms for raising capital, which includes both primary and secondary markets but does not designate a focus on the initial sale of securities. Thus, the correct identification of the primary market reflects its specific role in facilitating the first sale of new securities.