Stock Exchange Slide

Stock Exchange Definition

Stock Exchange

Stock Exchange is a marketplace where shares/ stocks, bonds and other similar financial instruments are traded. The advent of stock exchanges and listing of companies’ shares on the exchanges brought immense liquidity for the investors. Before coming into existence of stock exchanges investors were stuck with the shares and bonds, as it was very difficult for them to find and reach out to suitable buyers.

The world’s first stock exchange is supposed to be ‘The Amsterdam Stock Exchange’ established in 1602 by the Ditch East India Company, though this disputed by some (source: Wikipedia).

Engraving depicting the Amsterdam Stock Exchange, built by Hendrik de Keyser c. 1612. Artist  Claes Jansz. Visscher, Source: Wikipedia 

In India, during the manual trading days, many regional stock exchanges used to flourish, namely:

1. Bombay Stock Exchange (BSE)
2. Delhi Stock Exchange (DSE)
3. Madras Stock Exchange (MSE)
4. The Calcutta Stock Exchange (CSE)

The National Stock Exchange (NSE) was established in 1992 which for the first time provided a modern, fully automated screen-based electronic trading system, BSE and other exchanges followed suit and today BSE and NSE are the most popular stock exchanges operating in India.

What Is the Difference Between A Stock Exchange and A Bank?

Dear Ms.Thaiyal Nayaki!

Greetings!

A stock exchange is an open market place where financial instruments like shares (also called stocks) and bonds are traded. In earlier days brokers used go physically to the stock exchange and used to buy and sell shares and bonds on behalf of their clients/ customers. Nowadays with the advent of internet these trades are conducted in an online format.

A bank is an organisation which which collects deposits from customers and lends to a different set of customers. Deposits are collected in various categories like savings, fixed, recurring deposits, etc. Banks pay interest to depositors and charge interest from borrowers. Banks also render allied financia; services like issuing ‘Bank Guarantees’, opening ‘Letters of Credit (LCs)’ etc., for a fee.

If you want to learn more about finance and investing, you may regularly visit my blog,Value Investing, which is updated quite frequently.

Thank you,

Anand

Please Note: This is a reproduction of the question I had answered on the website ‘Quora’, which I thought could be useful to the visitors to this blog site also.