ADMS 3541 Lecture Notes - Lecture 25: Initial Public Offering, Otc Bulletin Board, Open Outcry

• School: York University
• Department: Administrative Studies
• Course: ADMS 3541
• Professor: Alan Go

Document Summary

A stock exchange is a centralized location that brings corporations and governments together with investors so trading activity can take place. Auction-based exchanges such as the new york stock exchange allow traders and brokers to physically and verbally communicate to execute buy and sell orders. Electronic exchanges take place on electronic platforms so they don"t require a centralized physical location for trades. Electronic communication networks connect buyers and sellers directly by bypassing market makers. The otcbb and pink sheets are two different over-the-counter markets where stocks delisted or unlisted stocks trade. A stock exchange is a place where different financial instruments are traded stocks, commodities, derivatives, etc. bringing corporations and governments together with investors. Exchanges help provide liquidity in the market, giving sellers a place to liquidate their shareholdings. They also ensure trading takes place in a fair and efficient manner so important information such as prices can be transmitted to investors and financial professionals.