The Psychopedia
  • Home
  • Dating
  • Sex
  • Love
  • Buzz
  • Blog
  • Finance
  • Lifestyle
  • Tech
  • Business
  • Breakups and Divorce
  • Home
  • Dating
  • Sex
  • Love
  • Buzz
  • Blog
  • Finance
  • Lifestyle
  • Tech
  • Business
  • Breakups and Divorce
  • Home
  • /
  • Blog

Importance of Stock Market Exchange in a Country

The word “Stock Exchange” may bring down chilling shivers to many people. It is actually a form of exchange that provide job to stock brokers, and traders facilitating the exchange of Bonds, Stocks and Securities. This practice can be traced to origin in the Mesopotamian clay tablets in the ancient world. Then the commodity exchanges started to flourish between countries. The world’s first stock exchange is a book that tells about the stock market and exchanges that took place in the seventeenth-century Amsterdam. The existing security markets took centuries to develop almost. These exchanges have played very important role in deciding many politic decisions. Even today it plays as an important decision maker. Each country has their own stock market exchange with the New York stock exchange topping them all.

NYSE
New York Stock Exchange

What role does it play in a country?

To answer this question, we should first know its roles in an economy. The roles could be listed as,

1. Providing Capital for business:

The stock market exchange provides finances for smaller companies for expansion by establishing shares to the public. This enables the people to become partners in developing companies and small companies to establishing their roots. They provide opportunities for the companies to venture capital. They allow them to raise money through partnerships. They track the performances of the companies, and publish them to their public investors through stock indexes. The stock exchanges provide possibilities for newly venturing companies to be a partner with largely established companies. They also enable the large companies for acquisition of less profiting companies which might be mutually beneficial in most cases and develop across countries.

2. Funding the government:

The stock market exchange also helps the government lending hand for developing infrastructures through a security procedure known as Bonds. These bonds are sold to the public and are used to raise money.  These bonds are repaid to citizens when they mature and  for which the government must eventually tax citizens or otherwise raise other funds.

3. Serves as a Barometer of the economy:

The stock exchanges play an important role to measure the economic state of a country. When the companies of a country which play an important role in the economy of the country are stable, the share price which implies the stock market is stable. When the prices fall, it may result in economic crisis such as, economic recession or depression. These are published through the indexes of the stock exchange.

stock-exchange
Stock Exchange
Thus, the stock market exchange in general is an important criterion that decides the economy of a country.

Who owns these stock exchanges?

These stock exchanges started as mutual organizations where the board consisted mainly of Share brokers. But now the trend is beginning to change and it is to demutualize the organization where the brokers tend to sell their shares in an initial public offering thereby making the organization to be a corporation and the corporation is expected to hold the shares of the lists in the exchange.

What does it take for a company to be listed on the stock exchange?

For a company to be listed on the stock exchange it must have some requirements met. These requirements are pre-defined by the exchange board. The following are the pre-defined criteria in some of the stock exchanges. The criteria for a few exchanges have been listed below.

  • New York Stock Exchange: For a company to be listed on the New York Stock Exchange also known as the NYSE it must have issued at least a million shares of stock worth $100 million and should have earned more than $10 million over the last three years.
  • NASDAQ Stock Exchange: For a company to be listed on the NASDAQ the company must have issued at least 1.25 million shares of stock worth at least $70 million and should have earned more than $11 million over the last three years.
  • Bombay Stock Exchange: Bombay Stock Exchange or the BSE has defined the requirements to be listed as a minimum market capitalization of 250 million and a minimum public float of 100 million.

What is the role of internet in the stock exchange?

Internet has proved its role in many of the recent developments and there is no exception for the stock exchange programs. The immediate communication has resulted in drastic increase or entire collapse of the stock markets in seconds. It has also enabled to trade a stock in a millionth of a second.  The New York Times says that powerful computers allow high-frequency traders to send hundreds of thousands of orders to be processed at unparalleled stock exchange speeds.Thus in a whole the stock exchange is nothing but a platform mutually benefiting the people who wants to sell more and to people who want to buy more along with deciding the fate of many people and countries.

Related posts:

  1. How Free Stock Trading Software Helps to Earn money?
  2. How To Buy Stocks Online
  3. Online Stock Trading Comparison- Things to Consider
  4. Everything you need to know about a stock trade company
Posted on 14 April 2015 by The Psy. This entry was posted in Blog and tagged importance of stock market, stock market, what stock market does in a country. Bookmark the permalink.
Try Some Aphrodisiacs Today!
Dishes That, Make Your Lover Hot!!!

    Recent Posts

    • 6 THINGS YOU DIDN’T KNOW ABOUT EVERYDAY OBJECTS
    • DON LEMON WALKED OFF: “Don’t Come To This Network Again” To A Guest
    • Report: McGregor, Mayweather agree terms
    • Adele Wins Album Of The Year | Acceptance Speech | 59th GRAMMYs
    • Trump vs. Truth: Last Week Tonight with John Oliver (HBO)
    • Daughter learns life lesson from mother
    • Do these guys actually give each other handjobs?
    • Is your dad your biggest inspiration as well?
    • Is that the most creative design or what?
    • Check out this parody to First Kiss

    Categories

    • Blog (58)
    • Breakups and Divorce (5)
    • Business (1)
    • Buzz (699)
    • Dating (24)
    • Finance (8)
    • Lifestyle (3)
    • Love (5)
    • Sex (16)
    • Tech (1)

    Tags

    ad amazing animal animation baby battle car cat cinema commercial dad dance dog entertainment experience family football fun funny game of thrones girl guy invention kid life love man movie music new people play reaction sex song sport surprise talent technology trailer tricks unique video viral World Cup

Tags

ad amazing animal animation baby battle car cat cinema commercial dad dance dog entertainment experience family football fun funny game of thrones girl guy invention kid life love man movie music new people play reaction sex song sport surprise talent technology trailer tricks unique video viral World Cup

Categories

  • Blog
  • Breakups and Divorce
  • Business
  • Buzz
  • Dating
  • Finance
  • Lifestyle
  • Love
  • Sex
  • Tech
  • Sitemap

Facebook



Posting....
Powered by