| The stock exchange is a vast organisation with | | | | members. |
| origins in about eleventh century France. From these | | | | 3. The Stock brokers. The men and women who |
| origins in agriculture, it has several duties to perform | | | | undertake the execution of our offline trading, are |
| nowadays. It caters for a vast variety of financial | | | | professionals who have gained their positions by |
| aspects and is the most important component of in | | | | fulfilling the requirements of several legal |
| the world of trading. Nothing has changed in the | | | | examinations. They're qualified and regulated by such |
| sense that it has involved banking, in one form or | | | | bodies as the FSA in the UK and the General |
| another, since those earliest days. | | | | Securities Representative Examination in the USA. |
| Here is an introduction of 5 criteria that outline what | | | | Their role is maybe not as prominent in recent years, |
| the stock exchange is all about: | | | | with the advent of online trading platforms. |
| 1. The Corporation. There's a slight misconception as | | | | 4. Traders are the people who make the market |
| to what a corporation is. In simple terms it is a legally | | | | move. Their buying and selling are what makes it all |
| binding document that hold a group of people | | | | happen and traders can be anyone from the full time |
| together in a business. It is s vehicle through which | | | | professionals to the part time day traders, from the |
| corporate law operates in order to hold the balance | | | | big bank and institution to the home hobby-traders. |
| between the various factions in the business | | | | For every buyer there's a seller and vice versa. It is a |
| environment. With respect to what we're interested | | | | zero-sum game. |
| in, the interests and obligations of shareholders, are | | | | 5. Stocks is the term applied to one of many items |
| binding in the terms of this document. | | | | that are traded. Stocks are the measure of units |
| 2. A Mutual organization. The difference between a | | | | representing the value of a company. It should be |
| mutual organisation and financially motivated | | | | noted that Stocks is an American term, whilst Shares |
| arrangement, or investment, is that the mutual works | | | | are the UK equivalent. Hence, they both amount to |
| on the basis of what the partners can bring to a | | | | the same thing. Each has its sub divisions or |
| business in terms of customer relationships. There are | | | | categories, depending on such criteria as the type of |
| no outside influences such as shareholders to satisfy | | | | industry for instance. |
| and funds are re-cycled into the business by the | | | | |