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Glossary

Secondary Market

The Secondary Market is the market on which previously issued structured products and securities are traded between investors after the original issuance. For structured products, the issuer itself frequently provides liquidity as market maker. Tradability can be limited, particularly during periods of high market volatility.

At a glance

  • The Secondary Market allows early exit before maturity, though often at a bid-ask spread.
  • Illiquidity in the Secondary Market can mean that an early sale is only possible at unfavourable prices.
  • The market value in the Secondary Market may be below the theoretical value, for example due to a widening of credit spreads.

Frequently asked questions

As a rule, the issuer provides bid and ask prices in the Secondary Market as market maker. A sale is therefore generally possible, but at a price that may be below the theoretical value. In extraordinary market conditions, liquidity may be restricted or the spread may widen significantly.

Part of the topic

AMC & Structuring

Sources: Swiss Structured Products Association (SSPA)

This entry is for general information purposes only and does not constitute investment, legal or tax advice. It is a simplified summary of the legal position and tax treatment.