Nailah Wright Asset of Stock Market
A
stock exchange standardizes investments, allowing people to shop for or sell discrete and identical stocks of possession in diverse groups. It helps the switch of funds among traders and organizations, regulating as vital to provide maximum protection for anybody’s investments. Many stock exchanges exist. The most important ones act as barometers of the economic performances of various nations.
 The process of exchange is generally for buyers to
name a price they are willing to pay for a particular stock and for sellers to name their selling price. In physical markets, brokers and specialists match buyers and sellers, but this can be done entirely by the computer in virtual markets.
 Providing
liquidity and Marketability to Existing Securities: Stock Exchange provides a ready and continuous market for buying and selling securities. It provides a platform where shares can be sold and bought by buyers and sellers.
 Pricing of Securities: Based on the forces of
demand & supply, Stock Exchange helps in putting a value on the securities which provide instant data to both buyers and sellers and thus helps in the pricing of securities.
 Safety of Transaction: All participants associated
with a stock exchange are well regulated, and are required to work within the legal framework given by the regulator.
 Contributes to Economic Growth: People get a
chance to buy and sell their shares, letting them invest money. Stock exchange provides a platform by which savings get channelized into the most productive investment proposals, which leads to capital formation & economic growth.
 Spreading of Equity Culture: Stock exchanges
have extensive information on the listed companies, which is further available to the public. This data helps in educating public about investments in securities which leads to spreading of wider ownership of shares.
 Providing Scope for Speculation:
Securities, when purchased solely with a view of gaining profit through price movement to a target is called speculation. Stock exchanges provide scope within the provisions of law for speculating in a restricted and controlled manner.