Functions of the Secondary Market

• To facilitate liquidity and marketability of the outstanding equity and debt instruments.
• To contribute to economic growth through allocation of funds to the most efficient channel through the process of disinvestment to reinvestment. 
• To provide instant valuation of securities caused by changes in the internal environment (company-wide and industry-wide factors). Such valuation facilitates the measurement of the cost of capital and the rate of return of the economic entities at the micro level. 
• To ensure a measure of safety and fair dealing to protect investors’ interests.
• To induce companies to improve performance since the market price at the exchanges reflects the performance and this market price is readily available to investors.