types of securities traded on a stock exchange
The main types of securities traded on a stock exchange are share - certificates of participation in the capital of the company, giving the right to receive dividends, and bonds - obligations of the issuers to pay their holders the annual income in the form of fixed interest and buy them at the expiration date. Stocks and bonds are bought and sold as on stock exchanges and on the OTC market. The types of securities traded on a stock exchange include cash and trade documents that can be presented to implement expressed their property rights: promissory notes, cheques, certificates of Deposit, coupons of the bonds, bills of lading, warehouse receipts (warrants), etc. Securities on a stock exchange directly at the auction are not exhibited. They are on a special Bank accounts, and are bought and sold parties.
In order to be quoted on the stock exchange, the stock value must comply with certain criteria, adopted by the exchange. Among them may be requirements to the legal status of the Issuer, the size of its Charter or share capital, income, nominal value of securities, etc. So, for example, on the new York stock exchange listed shares of about 2 thousand corporations. Each includes not less than 2 thousand shareholders and not less than 100 million in assets. Thus, for many companies to enter the stock exchange market means not only have wide possibilities in attracting borrowed capital, but also get into a prestigious group of firms.
The price at which implements security, is called its course. Rate of securities depends on the offerings of its income and is formed at the moment of conclusion of a transaction between the seller and the buyer. In the simplified form of purchase and sale of securities is as follows, the investor (buyer) instructs the broker to buy 100 shares of a certain company at a rate of 1 rouble per share. In turn, the seller instructs his broker implement the same batch of similar shares at the same rate.
Brokers are turning to the dealer-specialist, which forms a package of applications for the company. Seeing that he had received the proposals of mutually satisfactory and other proposal is not received, the dealer sets the official exchange rate at the level of 1 ruble, and both the client shall be notified of the transaction.
In fact, the dealer receives far more applications for the purchase and sale of the same securities with requests enough variety of courses. Its goal is to determine the rate at which you can meet most of the applications and the difference between demand and supply. This was exactly the information he cries out in the stock exchange hall in search of the missing securities or for the purpose of selling the surplus. The main objective of the dealer - to balance demand and supply and to implement all the parties of the securities. Since information about supply and demand is supplied constantly, course papers also undergoes in the course of the day certain variations. Therefore, in exchange sheets are fixed rates at the moment of opening of the stock exchange and at the time of termination of employment.
Modern technologies allow private investors to buy and sell securities through the Internet due to the various trading platforms - programs for Internet - trading. The trader puts in the program of the orders to buy or sell instruments, i.e., in electronic form gives the broker the order to commit the transaction at the stock exchange on its behalf.
Today anyone can become an investor, invest their assets in securities of any joint-stock companies of the world and to receive profits from the trade in tools of the stock market. Of course, in order to investments paid off to trade should be treated seriously and meaningfully.
