Stock Exchange

The stock market is an organized market where trade stocks of publicly traded companies (public or private) and other financial instruments such as options and bonds.

It may be in the form of a non-profit civil association, which maintains the site or the electronic trading system suitable for carrying out transactions of buying and selling securities, but as usual today and that the Stock Values act as S / A `s for profit through their services. Your equity in the case of civic associations, is represented by securities brokerage firms that belong to compose, in the case of S / A's this heritage is represented by shares. The bag must uphold high ethical trading standards, advertising - with speed, depth and details - the operations performed.

While there are entities that operate only with electronic trading (such as the U.S. Nasdaq), most stock exchanges have a physical trading floor, where negotiations are carried out.

The scholarships have a duty to pass on to investors (through magazines, newsletters and electronic media) about their daily business, announcements of relevant listed companies, market data and everything else that contributes to the transparency of operations.

Financial Markets types

Financial markets can be divided into different subtypes:

For the transferred assets

• Money Market: The trading with money or financial assets with a maturity of short-term, highly liquid assets usually within less than a year.
• Capital markets: financial assets are traded with a maturity of medium and long term basis to carry out certain processes of investment.
• Stock markets, which provide financing through the issuance of shares and allow the subsequent exchange of these.
• Bond markets, which provides financing through the issuance of bonds and allow the subsequent exchange of financial marketing estos.el is one way by which esclarem diversity of financial generosity.

Depending on their structure can be

• Organized markets.
• Unorganized market is called in English ("Over The Counter").

According to the negotiation of financial assets

• Primary markets: financial assets are created. In this market the assets are transferred directly by the issuer
• Secondary market: Only exchange existing financial assets, which were issued at an earlier time. This market allows holders of financial assets and sell the instruments that were issued in the primary market (or that had already been transmitted on the secondary market) and are in his possession, or purchase other financial assets. (Lilibet)

Other markets

• Commodities markets, allowing trading commodities.
• Derivatives markets, which provides tools for financial risk management.
• Forwards markets, which provide standardized forward contracts for trading products at some future date, see also forward.
• Insurance markets, allowing the redistribution of various risks, see the insurance contract.
• Foreign exchange market, which allows the exchange of foreign currencies or currency.

Financial Markets Features

• Size: Number of securities which are traded on a financial market. The more securities are traded on the wider financial market. So as shown above, financial markets are essentially based on market speculation.
• Depth: The existence of supply and demand curves above and below the equilibrium price that exists at a given time (there are people who would be able to buy at a price above the equilibrium price. And if there is anyone who is willing to sell at a lower price).
• Freedom: There are no barriers to entry or exit from the financial market.
• Flexibility: Prices of financial assets that are traded on a market, to change to a change occurring in the economy.
• Transparency: can obtain information easily. A financial market is more transparent when it is easier to get the information.

The perfect financial market would be one that we find:

• Large numbers of actors involved both the supply side as the demand side. So no one can influence the formation of financial asset prices. (High extent and depth)
• There are no transaction costs or taxes, or interest rate fluctuations or inflation. (High freedom)
• The assets are divisible and indistinguishable. (High flexibility)
• That there is perfect information, that everyone knows the same thing. (Added transparency)

Financial Market Definition

In economics, a financial market is a mechanism that allows operators to exchange financial assets. In general, any commodity market could be considered as a financial market if the buyer is not the purpose of immediate consumption of the product but the delay in consumption over time.

Financial markets are affected by the forces of supply and demand. Markets to all vendors placed in the same place, making it easier for potential buyers. The economy relies primarily on the interaction between buyers and sellers to allocate resources is called a market economy, in contrast to the planned economy.

Financial markets in the financial system, provide:

• The increase in capital (capital markets).
• The transfer of risk (in the derivatives markets).
• International trade (in the currency markets).

They are used to bring together those who need financial resources to those who have them.

Markets Origin

The emergence of money contributed very significantly to the trade. Market is, then, any set of transactions or business arrangements between buyers and sellers. As opposed to simply selling, the market involves regular and regulated trade, where there is some competition between the participants.

The market is also the social environment (or virtual) that fosters the conditions for exchange. In other words, be interpreted as a social institution or organization through which the suppliers (producers and sellers) and demanders (consumers or buyers) of a particular good or service, come into close business relationship to conduct business transactions abundant . The first markets in history worked through barter. After the introduction of money, began to develop commercial codes that ultimately gave rise to modern national and international companies. As production increased, communications and intermediaries began to play a greater role in markets.

A market definition according to marketing: Organizations or individuals with needs or desires that are capable and who are willing to purchase goods and services to meet your needs.