Importance of Stock Exchange

Stock exchange represents the condition of an economy, sentiment of the people for a  particular industry, sensitiveness of  any type of information, government policy & news related to home and foreign country.

Example:-Often in the business news we read that, after the xyz news, stock market goes down —-points.

So, we could define Stock exchange as the platform where every company perform according to its internal information and different economic, political, social condition of the country.

Now you could ask a question, how stock exchange helps the investors?

Answer is

  • If any company wants to invest in any of the industry of an economy, first of all they watch the movements of stock index of the particular industry in the stock exchange to understand the market condition.
  • Website of these stock exchanges provides the historical data of different indices and companies to help the investors in their decision making.
  • It provides a fearless trading platform on the basic of regulatory authority’s guidelines
  • It provides quick liquidity to the companies and investors.

So, we can define ,Stock exchange as the thermometer of an economy to measure the economic and business condition.