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Today, the major stock exchanges are:
• American Stock Exchange
• Australian Stock Exchange
• Bombay Stock Exchange
• Euronext
• Frankfurt Stock Exchange
• Helsinki Stock Exchange
• Hong Kong Stock Exchange
• Istanbul Stock Exchange
• JASDAQ
• Johannesburg Securities Exchange
• Karachi Stock Exchange
• Korea Stock Exchange
• London Stock Exchange
• Madrid Stock Exchange
• Milan Stock Exchange
• Nagoya Stock Exchange
• National Stock Exchange of India
• NASDAQ
• New York Stock Exchange
• Osaka Securities Exchange
• São Paulo Stock Exchange
• Shanghai Stock Exchange
• Singapore Exchange
• Stockholm Stock Exchange
• Taiwan Stock Exchange
• Tokyo Stock Exchange
• Toronto Stock Exchange
• Zurich Stock Exchange
Next to trade and the stock exchange, another important factor in
modern trading, which warrants some review of its history, is the
concept of currency. Introduced as standardized money, designed to
facilitate a wider exchange of goods and services in trading centers,
the earliest currencies were metal used to represent stored value.
Symbols were used to represent commodities and formed the basis for
trade in the Fertile Crescent for more than 1500 years.
Although the very first coins were nothing more than unmarked lumps of
precious metals such as copper or gold, the Ancient Spartans minted
coins from iron to discourage Spartan citizens from engaging in foreign
trade.
Well into the eighteenth and nineteenth centuries, there was a strong
balance.
It’s interesting to consider the unlikely resemblance that trading
today bares to trading in prehistoric times right the way up to, say
the 18th or 19th centuries. Trade and commerce are deeply routed in
communication, and these practices brought about many major
developments and changes to the way human beings live and interact.
Today, trading and the numerous stock exchanges around the world have a
major roll to play in driving the world economy. While you don’t need
to know much about the larger implications of a day’s trading to take
part yourself, if you
want to start to develop a sophisticated read of the market,
understanding the larger role of trading is the way to begin.
Consider for a moment the roles of the stock exchange:
1. To raise capital for businesses: The Stock Exchange provides
companies with the means to raise money for a variety of purposes. Most
companies use the stock exchange to raise capital for expansion, by
selling shares to those who would like to invest.
2. To mobilize savings for investment: When people invest their savings
in shares, stocks, or even bonds, it leads to a more rational
allocation of resources. Money funds, which could have been kept in
banks, are mobilized and redirected to promote business activity and
economic growth.
3. To facilitate company growth: Companies view acquisitions as an
opportunity to expand product lines, increase distribution channels,
hedge against volatility, increase market share, and acquire other
necessary business assets.
4. To redistribute wealth: By giving a wide spectrum of people a chance
to buy shares and therefore become part-owners (also called
shareholders) of profitable enterprises, the stock market may help to
reduce large income inequalities. However, capital losses may also
happen. Both casual and professional stock investors, through stock
price increases and dividends, get a chance to share in the profits of
promising business that were set up by other people.
5. To improve business and corporate standards in general: A wide and
varied scope of owners tends to improve on the management standards and
the efficiency of companies. Shareholders generally help to impose
higher standards from companies, and their demands tend to compound
with the rules for public corporations imposed by public stock
exchanges and government.
6. To create investment opportunities for small investors: As opposed
to other businesses that require huge capital outlay, investing in
shares is open to both the large and small stock investors because a
person buys the number of shares they can afford. Therefore, the Stock
Exchange provides the opportunity for small investors to own shares of
the same companies as large investors, and to enjoy similar rates of
return.
7. To help governments raises capital for development projects:
Governments at various levels may decide to borrow money in order to
finance infrastructure projects, such as sewage and water treatment
works or housing estates by selling another category of securities
known as bonds. These bonds can be raised through the Stock Exchange
whereby members of the public buy them, thus loaning money to the
government. The issuance of such municipal bonds can prevent the need
to directly tax the citizens in order to finance development, although
by securing such bonds with the full faith and credit of the government
instead of with collateral, the result is that the government must tax
the citizens or otherwise raise additional funds to make any regular
coupon payments and refund the principal when the bonds mature.
The stock exchange and the volume of trade in a day also give a strong
indication of the state of the economy. Stock exchanges, the prices of
shares, etc, are sometimes called barometers of the economy. At the
stock exchange, share
prices rise and fall depending, largely, on market forces. Share prices
tend to rise or stay when companies and the economy are generally
stabile and growing. Conversely, economic recession, depression, and
financial crisis, if these conditions become sufficiently extreme, may
eventually lead to the crash of a stock market, at which point the
value of shares collapses.
Most of the top traders, whether they’re trading stocks, bonds, or
futures; whatever it is they are trading, they tend to have a great
grasp of the small and the big picture. The very best traders stay
current with company news and general developments, but they also have
a good grasp upon the wider implications of the markets and trading for
the economy. Looking at both the micro and the macro, the best traders
are able to pick up on trends and developments to make prudent
decisions about their trades in both the long term and the short term.
If you want to make a sizeable income from your day trading, or if you
want to eventually become a professional day trader, imitating the very
best traders should be your objective.
Note:
After you sign up for this package, you
will need to confirm your request to receive your free day trading
checklist report. This is done by clicking on a
confirmation link in an email that will be sent to the address you
enter above. The subject of this email will be: "Confirm Your Request For
Information"
If
you do not
confirm your request, you will not get your free report
The information
in this guide and on this
site should not be construed as financial advice and are for
information purposes only. The authors and publishers are not financial
advisers. You should rely on your advisers and lawyers for financial
advice.
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