Stock exchange market, Finance Basics

Stock Exchange Market

The Idea and improvement of a Stock Exchange

Stock exchange also identified as stock markets are special "market places" whereas already held bonds and stocks are bought and sold.  In effect they are a financial institution that gives the facilities and regulations required to carry out that transactions quickly and lawfully and conveniently. Stock exchanges developed next to with, and are a necessary part of the free enterprises system. Or we can say no stock exchanges exist in that communist world outside Hong Kong and Macao - that have particular status, and Taiwan that is also claimed via China.They require for this kind of market came about like a conclusion of two main characteristics of Joint Stock Company or like Public Limited Company, shares.

1. First of all, these shares are irredeemable, because one time it has sold them; the company can not at all be compelled with the shareholder to take back its shares and provide back a cash refund, unless and till the company is liquidates and winding up.

2.The second characteristic is that these shares are, however, very transferable and can be bought and resold by other individuals and organizations, freely, the only requirement being the filling and signing of a document known as a share transfer form by the previous shareholder.  The document will then facilitate the updating of the issuing companies shareholders register.

These two characteristics of joint company shares brought about the requirement for an organized and centralized place where organizations and private individuals with money to spare or investors, and satisfy their individual necessitates.  Stock exchanges were the conclusion emerging to give a continuous auction market for securities, along with the laws of demand and supply determining the prices.

Posted Date: 2/1/2013 12:08:01 AM | Location : United States

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