Investment Policy, Primary Markets, and Secondary Markets - Assignment Example

Jurisdiction specifications and legal aspect consideration are other inputs that the company might use in an investment policy. Jurisdiction specification may include other inputs such as environmental, social, and governance standards, classes of assets, and guidelines to ensure effective collaboration with external managers.

The primary market differs from the secondary market in such that, for the primary market, the organization or company is involved directly in the transactions, while in the secondary market, there is no involvement between the company and the transactions because transactions occur between investors (Hall and Lieberman 405-406). Both market segments are interrelated and they influence each other in terms of performances. However, the primary market's success and functionality are dependent on the secondary market’s complementary role in providing and opening a business opportunity for primary investors. As a result, the secondary market forms the baseline for investors in primary issues to transact on their investments that give other investors a chance to invest in the company.  Consequently, the primary market functionally dependant on the secondary market.