The activity of Share Market Trading is carried out by a wide variety of stock market participants. The participants in share market trading could vary from the individual stock investors to the traders of hedge funds. The traders of hedge funds are amongst the bigger operators of the share market.
Stock Exchanges The stock exchanges are where the securities are enlisted and transacted. The traders take the help of the stock exchange professionals, who are adept at carrying out the orders of their respective clients. Some of the stock exchanges are found to execute their business offline.
Offline Stock Exchanges
The offline stock exchanges execute their business physically, on trading floors. The method by which business is conducted in these offline stock exchanges is called open outcry.
This form of business operation is primarily in the nature of auctions where the traders are allowed to bid verbally. The most common examples of such stock exchanges are the conventional ones and the commodities exchanges.
Online Stock Exchanges
The online stock exchanges are made up of a network of computers. These stock exchanges are virtual in nature and transaction in these stock exchanges are carried out electronically at computer terminals, by the traders.
Trading of Stocks
The trading of stocks takes place in the manner of auctions in the stock exchanges, where the both the buyers and sellers of stocks offer their prices for a stock. When both the offers are similar, the sale of that stock takes place. However if there are a number of buyers who have the same bidding price then the transaction is made on the basis of first-come-first-serve.
Purpose of Stock Exchanges
The basic aim of the stock exchanges around the world is to assist the transaction of securities between the buyers and the sellers. They primarily play the role of marketplaces in the context of share market trading.
Last Updated on : 26th June 2013