Based on following case study, answer the question.

Financial Market are classified on the basis of the maturity of financial Instruments traded in them. Instruments with a maturity of less than one year are traded in money market while instruments with longer maturity are traded in Capital market. Instruments with a maturity of short term/ period upto one year are close substitutes for money. While long term funds market, direct savings of the community into their most productive use leading to growth and development of the economy.

Which market helps the existing investors to disinvest and Fresh investors to enter the market ?

Secondary Market

The correct answer is option (4) : Secondary Market

Providing Liquidity and Marketability to Existing Securities: The basic function of a stock exchange is the creation of a continuous market where securities are bought and sold. It gives investors the chance to disinvest and reinvest.

The secondary market is also known as the stock market or stock exchange. It is a market for the purchase and sale of existing securities. It helps existing investors to disinvest and fresh investors to enter the market. It also provides liquidity and marketability to existing securities