Secondary market
Market basicsThe exchange, where existing shares are traded between investors without the company’s involvement.
In plain terms
The second-hand market. Over 99% of all trading happens here.
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Glossary
Every term is defined twice: once the way a filing would put it, and once the way somebody would explain it to you across a table. The second one is usually the one that sticks.
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Authorised participant
Market basicsA firm appointed by a fund house and permitted to create and redeem an exchange-traded fund’s units in creation-unit blocks against the underlying basket.
In plain terms
The only party who can close a premium or a discount by making or unmaking units. Retail investors deal only in the secondary market, which is why the link between price and basket is a trade somebody has to want to do rather than a rule.
Sovereign gold bond
Market basicsAlso called: SGB
A government bond denominated in grams of gold, paying interest on top.
In plain terms
The only form of gold that pays you 2.5% a year. The cost is an eight-year term and a thin secondary market.