A investment trust that usually generates cash flows from one business or operating company, unlike an investment fund, which generates income from a diversified pool or portfolio. The trust holds debt and equity interests of an operating business. Businesses that exhibit these characteristics may opt for a trust structure over a corporate structure to take advantage of tax efficiency.
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- Secondary Market
After the initial sale, the securities market where trading takes place between investors. When business or government initially offers securities for sale to investors, it is done through the primary market.