What Are The Functions Of The Stock Exchange?

It is an open market for the buying and selling of financial assets. General public can take part in the sale and purchase of securities of different companies. Stock exchange provides information about the change in prices of various securities. It also provides information about the overall economic conditions of the country. Stock exchange works as an indicator of the economy. If the business in stock exchange market is going well, it shows that the economic conditions of the country are good and vice versa.

Stock exchange is a market where buyers and sellers of securities come together. Due to this stock exchange play the role of an intermediary. It provides the facility of speculation to the speculators. Speculation is a way by which demand and supplies of the securities are adjusted. It provides the facility of capital formation to the listed companies, because it is a place where the people come and invest their surplus funds.

If the management of a company wants to trade the share of the company in the stock exchange, they will have to fulfil the requirements for the listing of company. Stock exchange has indirect impact on the management of the company. Stock exchange protects the investors by ensuring the fair dealing for the sale and purchase of securities. The members of the stock exchange are bound to act within the limits set by the stock exchange.

It is about buying and selling different stocks!!

Organize ready market
turning investment into cash
aid to capital formation
proper evaluation of securities
profitable use of capital
facilities for speculators

Stock exchange makes the movement of money into the system. People invest their savings through the purchase of securities for making profit and to beat the inflation. This makes a flow of fund in to the economy. Increase in the market capitalisation of the companies make them strong and help in the economic growth by providing employment and by increasing production etc. If the circulation of money will stop then the money will be plunged in the hands of the people, the growth will be stopped, so the Stock exchange are very important in any economy.