Broadly, assets are classified into categories like current assets (cash, receivables), fixed assets (property, equipment), and financial assets (stocks, bonds, mutual funds). For investors, financial assets are particularly important because they represent opportunities to grow wealth through markets.
This brings us to the Primary Market, where many financial assets originate. The primary market is where companies issue new securities—such as shares or bonds—for the first time to raise capital. When you participate in an IPO (Initial Public Offering), you’re buying assets directly from the issuer in the primary market. These newly created assets then move to the secondary market, where they are traded among investors.
Why do assets matter?
- Wealth Creation: Assets generate income or appreciate in value over time.
- Liquidity: Some assets, like stocks, can be quickly converted to cash.
- Risk Management: Diversifying assets reduces financial risk.
Understanding assets also helps in making informed investment decisions. For instance, while equities offer growth potential, debt instruments provide stability. Investors often balance their portfolios with a mix of assets to achieve long-term goals.
In short, assets are more than just possessions—they are tools for financial growth. Whether you acquire them through the primary market or secondary trading, managing assets wisely is key to building a secure financial future.
Mutual Fund investments are subject to market risks, read all scheme related documents carefully.