Equity markets channel investment into corporate ownership. Companies obtain funds by offering ownership claims to investors, while those investors can later trade the claims among themselves. The initial sale of newly issued securities gives the company access to capital; subsequent transactions normally transfer ownership without raising new funds for the issuer. Prices are formed through trading and reflect expectations about the company as well as wider economic conditions.
Passende Formel
Source: European Central Bank (ECB) (source). This glossary entry is an independently worded adaptation of the cited information.