A stock exchange, securities exchange, or bourse is a marketplace where stockbrokers and traders can buy and sell securities, such as shares of stock, bonds, and other financial instruments. Stock exchanges may also provide facilities for the issue and redemption of such securities and instruments and capital events including the payment of income and dividends. Securities traded on a stock exchange include stock issued by listed companies, unit trusts, derivatives, pooled investment products, and bonds.
Stock exchanges can be physical locations, such as the New York Stock Exchange (NYSE) located on Wall Street in Manhattan, or completely electronic, like the Nasdaq Stock Market. Buyers and sellers meet to trade stocks through an exchange, and exchanges can be auction-based or electronic.
To be able to trade a security on a certain stock exchange, the security must be listed there. Usually, there are various requirements for different exchanges designed to protect investors. Stock exchanges act as an agent for the economy by facilitating trade and disseminating information. Companies are able to raise capital to fund through initial public offerings (IPO) or issuing of new shares.
