A stock exchange is an organized market for shares, loans, foreign exchange or determined goods (securities trading: English Brokerage). Likewise of it derived rights are acted. At the stock exchange brokers settle during defined commercial times of courses (prices), devoted from the orders to sell and purchase (Orders), available with them. By supply and demand it comes in such a way to a trade.

Purpose of a stock exchange

A stock exchange serves the temporal and local (in recent time also virtual) concentration of the trade of fungiblen goods under supervised price formation. The goal is an increased transparency of the market for securities, the increase of the efficiency and the market liquidity, the decrease of the transaction costs as well as the protection from manipulations. Differently than in the so-called off-board (OTC) trade trade supervision by the stock exchange committee-legally through commercial supervisory bodies is controlled.

Emergence of the name

The emergence of the name stock exchange is disputed. Probably the term from the fusion of the name of a buyer family from that originated in to 16. Century, the family "van the Beurse", with latin term Bursa. Other sources attribute the name to a market place in the Belgian city The first stock exchange was created 1531 in Antwerp.

Stock exchange forms

The classical form of the stock exchange is the operational readiness level stock exchange (also parquet trade called). There the brokers meet windings off in persona and by discussions their business. This happens either in the self-trade or on behalf its customers.

With computer stock exchanges like the commercial platform XETRA a computer-assisted commercial system takes over the broker function. Here inputs over computer masks are made and the computer system place independently the courses. The principal part of the conversion is completed meanwhile over computer-assisted stock exchanges.

Commercial forms

According to commercial forms categorized the following kinds can be differentiated from stock exchanges:

• the Market Maker stock exchange,
• the auction stock exchange,
• as well as hybrid forms, like trade e.g. sequential combines with auctions.

Depending upon kind of the completion of the trade one differentiates

• Option dealings and

Commercial times

With the commercial times at all stock exchanges, distinctive between the parquet trade and the computer trade (like e.g. XETRA). Smaller stock exchanges have often only the parquet trade. The parquet trade usually begins at all stock exchanges around 09.00 h local time and usually ends between 17.00 h and 17,45 h local time, while the so-called open market trade runs e.g. in the XETRA still to 20,00 h local time.

With a EDP-supported commercial time manager one can adjust oneself additionally the treatment and production of user-defined commercial times sessions for individual instruments. The user-defined session overwrites the session of the Providers.

Example: The Provider supplies for the DAX index a commercial time session of 09:00 - to 20:00 with clock. Since the open market courses do not fall after 17:45 clock any longer so important, one can provide oneself a session of 09:00 - 17:46 clock. All open market courses are not indicated now no more in the Chart, are thus faded out.

Acted articles

Thereby the equivalent condition of the commercial instruments (viability by standardisation) is characteristic and indispensably, which makes possible only an acting without their operational readiness level. One differentiates depending upon kind of the acted articles (stock exchange commodity)

• Securities (stock exchange)
• Being (product), and raw materials
• Foreign exchange,
• Service and
• Derivative stock exchanges.

For the completion of supply and payment fixed between the market participants partly did not codify () usages have themselves formed. Besides lately in Germany also instructions of the Federal Institution for supervision of financial service were published over the minimum requirements in the trade with securities (e.g. Shares or obligations).

Prognoses - share analysis, share evaluation, indices

It concerns statistic instruments, which illustrate prices and quantities. A share index shows the evaluation of a Aktienportfolios at a certain time. By the definition of a certain Portfolios a share index is suitable by the view of the value development during a certain period as indicator for the stock exchange climate, in addition, for the overall economic development or individual industries. Most important share index in Germany is the DAX, in Austria of the ATX and in Switzerland of the SMI. Further internationally considered indices are Dow Jones (the USA), Nasdaq (the USA), S&P 500 (the USA), the Japanese Nikkei, the European euro Stoxx 50, the British FT-SE 100, the French CAC 40, the Italian MIB 30, the Spanish IBEX or the MSCI World share index.

Prognoses for net assets (value of a share), share analysis:

• Fundamental analysis
• Efficiency market hypothesis, capital market theory: Coincidence path (random mill)
• Technical analysis
• Speculation blister, new Economy, Chartanalyse,

The security analysis generally concerns itself with the analysis of shares and financing titles. The task places itself, in which way information to an investment to be procured to be supposed and like these use to let favourable be able themselves. The security analysis can be arranged in principle into three subranges:

• Technical analysis
• Fundamental analysis
• Capital market theory

With the progress control of the security analysis is the measuring of performance of importance. This tries to give over it information how the risk-set net yield of a Portfolios developed compared with a bench mark.

A reason for course changes new, unknown information can its (information efficiency). In addition it can come to excursions due to changed risk attitude of the market participants or due to a changed liquidity need.

Stock exchange strategies, investment strategies and stock exchange speculation

see major items speculation (economics) and strategy (economics)

Important stock exchanges

Internationally important are New York (New York stick Exchange, New York Mercantile Exchange and the technology stock exchange NASDAQ), London (London stick Exchange and London Metal Exchange), Tokyo, Frankfurt, Hong Kong, Singapore, euroNEXT (Amsterdam, Paris, Lisbon and Brussels) and Zurich (SWX Swiss Exchange). The most important stock exchange in central Eastern Europe is the Polish Warsaw stock exchange. In Austria there are the Viennese stock exchange.

The most important stock exchange in Germany is the Frankfurt one stock exchange (FWB) (including the electronic commercial platform XETRA) and EUREX). A majority of the stock broking in Germany is completed over the FWB and XETRA (March 2005: Portion of the trade with German shares approximately 97 per cent, with foreign shares approximately 78 per cent). The FWB has a long tradition. It was created already 1585 and developed since then this to one of the prominent international commercial centres for shares and loans. of the Frankfurt stock exchange is the German stock exchange AG. It is responsible for the enterprise of the FWB.

In addition it gives in Germany sieves further Stuttgart (stock exchange Stuttgart), Munich (stock exchange Munich). Hamburg (stock exchange Hamburg), Duesseldorf (stock exchange Duesseldorf), Hanover, Berlin and Bremen (as parts of the stock exchange Berlin Bremen).

The most important stock exchanges in the USA are national the American stick Exchange (AMEX), Chicago Mercantile Exchange (CME), the Association OF Securities Dealers Automated Quotations (NASDAQ), the New York Mercantile Exchange (NYMEX) and the New York stick Exchange (NYSE).

Articles in category "Stock exchange"

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