The Part and Capacity of a Stock Trade

Presentation Transcript



The Role and Function of a Stock Exchange By Enid E Bissember GASCI

Outline Overview of monetary markets Institutional framework Role and elements of stock trade

Overview of Financial Markets Two sorts of budgetary markets Money markets Capital markets Primary market Secondary market

The Hierarchy of Markets Asset upheld securities & subordinates Corporate securities & values Government security showcase Gov't T Bills Money advertise

Supporting operators Financial Market Insurance cos Capital market Primary Mkt Inst Money advertise NIS Commercial banks Primary market Credit unions Secondary market Stock trade Firms raise capital Short term instruments Investors exchange securities issued in essential market obligation value Public Private position

Market foundation Stock trade Clearing and settlement Education and preparing Investors' insurance Rating office

Instruments Most prominent contributing instruments Stocks and shares Bonus issues Rights issues Equities Bonds Corporate Government

Intermediaries Hand in Hand Beharry stockbrokers Trust organization GuyAmerica Brokerage houses Stock merchants Advisors

Regulation & Supervision A couple addresses Ever thought about how the capital markets function Who sets the principles What does the stock trade do What is the part of the stock agent How to wind up an enrolled intermediary

The Regulator Foremost power directing the capital markets With mission to advance and look after Fair, effective , secure and straightforward market and to encourage the systematic improvement of the stock trade

Role and Functions of a stock trade Established with the end goal of helping, managing and controlling business of purchasing, offering and managing in securities

Role and Functions of a stock trade cont'd Provides a business opportunity for the exchanging of securities to people and associations trying to contribute their sparing or abundance finances through the buy of securities

Role and Functions of a stock trade cont'd Provides a physical area for purchasing and offering securities that have been recorded for exchanging on that trade

Role and Functions of a stock trade cont'd Establishes rules for reasonable exchanging rehearses and controls the exchanging exercises of its individuals as indicated by those tenets

Role and Functions of a stock trade cont'd The trade itself does not purchase or offer the securities, nor does it set costs for them

Fair The trade guarantees that no speculator will have an undue preferred standpoint over other market members

Efficient market This implies that requests are executed and exchanges are settled in the speediest conceivable way

Transparency Investor settle on educated and canny choice about the specific stock in view of data

Transparency cont'd Listed organizations must uncover data in auspicious, finish and precise way to the Exchange and the general population all the time

Transparency cont'd Required data incorporate stock cost, corporate conditions and improvements profit, mergers and joint endeavors, and administration changes and so on

Doing business People who purchase or offer stock on a trade do as such through a representative

Doing business cont'd The specialist takes your request to the floor of the trade searches for a dealer speaking to somebody needing to purchase/offer If a commonly pleasant cost is found the exchange is made

Some kind of requests Limit arrange Market arrange Day arrange Open All or none Any part Good through

Price At any point in time, the cost of beforehand issued stock is dictated by the back and forth movement of free market activity

Listing necessities There are particular prerequisites for permitting an open organization to rundown its securities on the Stock Exchange these are set out in the enactment

Benefits of posting Visibility Market bolster Investors certainty Increased interest for items and administrations Overall increment in gainfulness

Once exchanged Aura of unwavering quality Accuracy in reporting budgetary information Reputation Strength

Delisting Stock trade can delist organizations for various reasons incorporating :- Merger with another organization Solvency issues Name change organization requested that be expelled Failure to agree to trade rules

Desirable Characteristics of a securities exchange Liquidity Ability to offer an advantage rapidly at a genuinely known cost Low exchanges costs

Desirable Characteristics of a stock exchange cont'd Availability of data Market productivity Prices respond rapidly to new data Small cost vacillations Narrow cost spread

Financing the trade Transaction charges paid by individuals for every request executed Fees paid by firms when their securities are initially recorded Annual expenses by firms Entrance charges from new individuals offer of noteworthy exchanging and market data

Major difficulties for the Exchanges Cross fringe exchanging Issuers and speculators are growing their viewpoints past their home markets Investors turning out to be a great deal all the more requesting

Regulatory change Transparency and Corporate Governance Protection to minority Shareholders Strong industry controller Enhance showcase certainty Corporate Governance Disclosure

Ownership of the organization is by the general population as shares one share, one vote Owners Board is chosen by shareholders to speak to the best advantages of the proprietors Board of Directors Board contracts and fires the administration of the organization Managers