When buyers and sellers meet to exchange shares of a company, then they do it at the stock exchange. Stock exchanges are virtual or physical market places which offer standardized procedures for stock trading. This is of benefit for both parties, buyers and sellers, because only an efficient and liquid stock market is a secure place to trade shares.
Stock markets play an important role in today’s economy. For a company it’s the best place to raise much money quickly. Companies sell shares to have more money for investments. They can achieve their business goals faster. Private investors can buy shares to become a partial owner of the company with voting rights at the shareholder meeting and the right of shared profits. For an investor it’s the only way to become part of a business and enjoy the chances for high profits without founding an own company. Stocks also limit the risks and liability. In the worst case, you loose the purchase price when the shares go worthless.
There are various different stock exchanges. The most important ones in the United States are the New York Stock Exchange (NYSE) and the NASDAQ. The NYSE is a physical market...
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