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Question
Explain the functions of Stock Exchange.
Long Answer
Solution
- Ready and Continuous Market: Stock exchange helps investors to sell their securities easily. And also he can convert his cash into securities.
- Correct Evaluation of Securities: The prices at which securities are bought and sold are recorded and informed to the public. These prices are called “market quotations”
- Protection to Investors: All dealings in stock exchange are in accordance with well-defined rules and regulations. Any malpractice will be severely punished.
- Proper Channelisation of Capital: People like to invest in the shares of companies which yield good profits. Also, people invest in the companies which are giving good dividends.
- Facilities for Speculation: Speculation is an integral part of stock exchange operations. As a result of speculation demand for and supply of securities are equalized.
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Functions of Stock Exchange
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