Stock Exchange

             what is the stock exchange and how it works-

A stock exchange is a marketplace where publicly traded companies' shares of stock are bought and sold. The primary function of a stock exchange is to provide a platform for buyers and sellers to meet and exchange securities, including stocks, bonds, and other financial instruments.

Here's a brief overview of how a stock exchange works:

1. Companies go public by issuing shares of stock to investors. These shares represent ownership in the company and can be bought and sold on the stock exchange.

2. Buyers and sellers place orders to buy or sell shares on the stock exchange. Orders can be placed through a broker or online trading platform.

3. The exchange matches buyers and sellers based on their order criteria. This process is called price discovery, where the market determines the price of the shares based on supply and demand.

4. Once a trade is matched, it is executed, and the shares are transferred from the seller's account to the buyer's account. This is known as settlement.

5. The exchange tracks the prices of the shares and updates them in real time, allowing investors to monitor the performance of their investments.

The stock exchange operates within a regulated framework to ensure transparency and fairness in trading. It is an essential component of the global financial system, enabling companies to raise capital and investors to earn returns on their investments.

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