Many Secondary Markets Are Continuous, Which Means That Prices Are

question 30

Essay

Many secondary markets are continuous, which means that prices are determined continuously throughout the trading day as buyers and sellers submit orders. Give an example of this.

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Definitions:

Preferred Shares

A class of ownership in a corporation that provides a higher claim on assets and earnings than common shares; dividends must be paid on these shares before any can be distributed to common shareholders.

Dividend Income

Earnings distributed to shareholders from the profits achieved by a company, often calculated per share and paid out in cash or additional shares.

Fair Value

An estimated market value of an asset, liability, or financial instrument, determined based on the current market conditions and not its historical cost.