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You could lose all the money you invest in private markets
Private market investments are highly illiquid – there is no guarantee of liquidity, and you may not be able to sell your shares or realise your investment for several years or at all
These investments are high risk and not suitable for most investors
You should only invest if you can afford to lose all your investment
Private market investments should only form a small part (typically no more than 10%) of your investment portfolio
Understanding the difference between primary and secondary markets is fundamental to knowing where and how securities are created and traded.
The primary market is where new securities are issued for the first time. When a company conducts an IPO, issues new bonds, or the government auctions Treasury bills, these transactions occur in the primary market.
In the primary market, the issuer (company or government) receives the proceeds from the sale. Investors buy directly from the source. RetailBook operates primarily in this space, connecting retail investors with primary market opportunities.
The secondary market is where previously issued securities are traded between investors. Stock exchanges like the London Stock Exchange (LSE) and AIM are secondary markets. The issuing company does not receive proceeds from these trades.
Secondary markets provide liquidity — the ability to buy and sell investments easily. This liquidity is one of the key advantages of publicly traded securities.
When you invest through RetailBook in an IPO or bond offering, you are participating in the primary market — buying new securities at the offer price. After the securities are listed, they trade on the secondary market where prices fluctuate based on supply and demand.
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Disclaimer: This educational content is for informational purposes only and does not constitute financial advice. Investment decisions should be based on your own research. Past performance is not indicative of future results. Capital is at risk. FCA regulations apply.