Financial markets
Iordachi Victoria, dr., conf. univ. - Tranzacţii bursiere, curs de lecţii
2013
THEME 2. SPOT STOCK EXCHANGE TRANSACTIONS WITH PRIMARY
FINANCIAL INSTRUMENTS
(4/4hs)
2.1. Organization of spot transactions on different stock exchanges
Organizational forms of stock exchange trading, usually, depend on the general standing of securities market, especially on:
Market depth (the bigger is the number of investors, the deeper is the secondary market);
Market size (the higher is the supply and demand of securities, the more extended is the stock exchange market);
Resistance level (has a direct connection with price range according to which market participants can buy or sell securities).
If market conditions are changed, a rupture between supply and demand is produced and prices are influenced by other different factors.
Inte rnational stock exchanges have common features according to:
Designation of stock exchange components: official market from France and Germany; secondary market and ―over the counter markets‖ in other European countries. In USA –
Stock exchange market, OTC market, the third and the fourth market; In Japan – stock exchange market;
Negotiation object: domestic securities are traded on official market (national securities market in Great Britain); primary securities are traded on OTC market (international securities market in Great Britain).
According to their nature, stock exchange markets 1 are divided into two categories: auction and negotiation markets.
Stock exchanges according to their nature represent auction markets, i.e. the place of concentrating buy and sell orders and insuring the market liquidity by the stock exchange brokers – market agents, who act as assets’ intermediaries. That is why the stock exchange is also called the intermediary market, or the agency market.
1
A stock exchange is a mutual organization which provides trading facilities for stock brokers
and
2013
THEME 2. SPOT STOCK EXCHANGE TRANSACTIONS WITH PRIMARY
FINANCIAL INSTRUMENTS
(4/4hs)
2.1. Organization of spot transactions on different stock exchanges
Organizational forms of stock exchange trading, usually, depend on the general standing of securities market, especially on:
Market depth (the bigger is the number of investors, the deeper is the secondary market);
Market size (the higher is the supply and demand of securities, the more extended is the stock exchange market);
Resistance level (has a direct connection with price range according to which market participants can buy or sell securities).
If market conditions are changed, a rupture between supply and demand is produced and prices are influenced by other different factors.
Inte rnational stock exchanges have common features according to:
Designation of stock exchange components: official market from France and Germany; secondary market and ―over the counter markets‖ in other European countries. In USA –
Stock exchange market, OTC market, the third and the fourth market; In Japan – stock exchange market;
Negotiation object: domestic securities are traded on official market (national securities market in Great Britain); primary securities are traded on OTC market (international securities market in Great Britain).
According to their nature, stock exchange markets 1 are divided into two categories: auction and negotiation markets.
Stock exchanges according to their nature represent auction markets, i.e. the place of concentrating buy and sell orders and insuring the market liquidity by the stock exchange brokers – market agents, who act as assets’ intermediaries. That is why the stock exchange is also called the intermediary market, or the agency market.
1
A stock exchange is a mutual organization which provides trading facilities for stock brokers
and