How the Stock Exchange works

How the Stock Exchange works

The Stock Exchange is an environment where stocks and other financial assets are traded. It is an organized and regulated market where investors can buy and sell securities issued by companies or the government.

The operation of the Stock Exchange is based on supply and demand. Investors interested in buying stocks make their bids, while investors who want to sell stocks make their bids. When an investor's bid coincides with another investor's ask, the trade is executed.

To participate in the Stock Exchange, it is necessary to open an account at a stockbroker. The brokerage firm is responsible for mediating negotiations between investors and the Exchange. Through the brokerage house, the investor can send his orders to buy or sell shares.

On the Stock Exchange, negotiations take place electronically, through a system called Home Broker. Home Broker allows investors to access the stock market online, being able to view asset quotes, send buy or sell orders and monitor their operations in real time.

In addition to stocks, other types of financial assets are also traded on the Stock Exchange, such as options, futures contracts, ETFs (Exchange Traded Funds) and debentures. Each type of asset has different characteristics and risks, offering investment opportunities for different investor profiles.

The Stock Exchange is a risky investment environment, as asset prices can vary according to several factors, such as economic news, politics and global events. Therefore, it is important that the investor has knowledge about the financial market and makes a careful analysis before making his investment decisions.

It is possible to invest in the Stock Exchange both in the short term, seeking quick gains with speculation, and in the long term, aiming at equity growth over time. Each investment strategy has its advantages and disadvantages, and it is important that investors define their objectives and risk profile before starting operations.

In short, the Stock Exchange is a market where stocks and other financial assets are traded through an electronic system. It is a risky investment environment, where investors can pursue opportunities for financial gains, but are also exposed to possible losses. Therefore, it is fundamental that the investor is aware and makes a careful analysis before investing in the Stock Exchange.

Next page of the Free Ebook:

3History of the Stock Exchange

2 minutes