(a) What is a stock exchange market.
(b) Explain six functions of the stock exchange market
Explanation
(a) The meaning of Stock Exchange Market : A stock exchange market is a specialized market for the buying and selling of existing securities.
(b) The Functions of Stock Exchange Market:
(i) Quoted companies raise funds and capital by selling shares, bonds, stocks and debentures in the stock exchange market.
(ii) It provides rules and regulations that will guide somooth opertation on the floor of the stock exchange.
(iii) It provides professional advice/information to investors on sales and management of securities.
(iv) It allows forces of demand and supply to fix prices of securities of quoted companies/evaluation of existing shares.
(v) It facilitates the transfer of shares fromo wners to investors. Investors who want to withdraw from one company to another can do so without hindrance. Ivestor can buy and sell old securities
(vi) It provides avenue for government to raise funds to execute projects in their various states through issue of bonds.
(vii) It instill discipline in the operations of quoted companies/It ensures that companies quoted have good reputation. this will gear up companies to perform well or maintain high standard.