About Stock Exchange

( A s t o c k e x c h a n g e , s e c u r i t i e s e x c h a n g e o r b o u r s e i s a corporatio
nor mutualorganizationwhich provides "trading" facilities for stock brokers and traders,
to trade stocks and other securities.)Stock exchanges also provide facilities for the issue
and redemption of securities as w e l l
as other financial instruments and capital events including the
p a ym e n t o f i n c o m e a n d dividends. T h e s e c u r i t i e s t r a d e d o n a s t o c k e x c h a n g e
i n c l u d e : shares issued by companies, unit trustsand other pooled investment products
and bonds.To b e a b l e t o t r a d e a s e c u r i t y o n a c e r t a i n s t o c k e x c h a n g e ,
i t h a s t o b e l i s t e d t h e r e . Usually there is a central location at least for
recordkeeping, but trade is less and less l i n k e d t o s u c h a p h ys i c a l p l a c e , a s
m o d e r n m a r k e t s a r e electronic networks, w h i c h gives them advantages of speed
and cost of transactions. Trade on an exchange is by members only. The initial
offering of stocks and bonds toinvestorsis by definition done in the primary market and
subsequent trading is done in thesecondary market. A stock exchange is often the most
important component of astock market. Supply and d e m a n d i n s t o c k m a r k e t s
i s d r i v e n b y v a r i o u s f a c t o r s w h i c h , a s i n a l l free markets, affect the price of stocks
(seestock valuation).There is usually no compulsion to issue stock via the stock
exchange itself, nor must stock be subsequently traded on the exchange. Such
trading is said to be off exchange or over-the-counter . T h i s i s t h e u s u a l w a y
t h a t bonds are traded. Increasingly, stock exchanges are part of a global market for
securities