Stock Market When you buy milk, you participate in the market for dairy products. Likewise, when choosing where to study, you participate in the Market for education without forgetting endless demands. The scenario is not so different in the stock market, and the only scope is that financial products are traded. For this blog, we will explain what transactions are carried out in this market and, therefore, the financial products that work in it.
Types Of Transactions In The Stock Market. Idea Development
We have already said that stocks and debt instruments are traded in this first idea. But, still, to know what can carry out processes based on these products.
Types Of Transactions In The Stock Market. Operations
The Most Special Operations In The Stock Market Are The Following:
- Securities brokerage: Seeks to grant the most appropriate conditions for bidders and applicants seeking to meet them. The intermediary produces concepts such as investment information and analysis, diversification, and proximity of bidders and applicants.
- Issuance of securities: Corresponds to the management carried out by corporations in search of financing; it is an existing operation in the stock market since companies seeking to sell their shares can only market them in the stock market.
- Third-party fund manager: Includes Mutual Funds, Investment Funds, and Pension Funds. Corresponds to integrated assets, which result from investors’ contributions to the investment of publicly offered securities.
Types Of Transactions In The Stock Market. Conclusion.
Through this blog and complemented with all the previous ones discussing the securities markets, we hope to increase the cultural background and obtain greater analysis to understand the needs.
The Stock Market operates like any other market in which goods are traded; only it is about financial instruments.
The demand and supply of these instruments are found in this place of exchange called the Stock Market. purchase sale can made intermediaries, Stock Exchange it, Direct negotiation. Between the interested parties.
Investors (individuals or companies) look for the financial instruments that give them the highest possible return according to the risk they are willing to assume.
Issuers require capital to finance their projects. Therefore, they can offer investors securities (stocks, bonds, etc.) to gather these resources.
Investors And Issuers Meet In The Stock Market.
1. Securities Issuers
They offer securities (shares, bonds, mutual fund quotas, etc.) for sale in the Market: open corporations and issuers of securities, Mutual Funds, Investment Funds, FICE, State, Central Bank, and Banks.
2. Securities Claimants
People or institutions that wish to obtain profits by acquiring investment instruments: Investment Funds, FICE, Pension Funds, Mutual Funds, Foreign Investors, And also Private Investors, AFP, Soc. Admin. Graves. of Funds, Banks, FBR, and Soc. Administrator FBR.
3. Securities Intermediation
Operations that bring applicants and bidders closer together: Securities Intermediaries (Securities Agents, Stock Brokers, and Banks ), And also Intermediation Operations ( Stock Exchanges and Over-the-Counter Market ), And also Support Companies (Securities Depository Companies and Soc. Admin. Clearing and Settlement Systems ).
4. Regulators And Supervisors
Supervise that the activities and participants of the Stock Market operate within the legal framework and other regulations that apply to them: Commission for the Financial Market (CMF), Superintendence of Pensions and Central Bank,
5. Information Support Entities
Contribute to auditing by reviewing And also the financial information of companies: External Audit Companies and Risk Rating Agencies.
The market Stock market in which agricultural products are traded: Agricultural Products Exchange and Product Stock Brokers.
How Does It Operate?
- Entities that want their securities to be offer on the Market. And also request their registration with the CMF.
- The securities and issuers are register in the public registries of the CMF.
- And also The entities issue the securities that will be place and trade on the Market.
- Given their risk profile, And also investors can request the advice of intermediaries to choose the securities they will acquire or resort to the over-the-counter market.
- Brokers purchase securities on behalf of the investor, And also usually on a Stock Exchange.
- And also Stock Exchange is where intermediaries match purchase orders with sales orders.
- As the investor decides, And also the property titles or certificates remain in possession of the investor, or the broker. If they stay in the broker’s residence, They will be keep in the Central Securities Depository, In addition, investors can take these titles or certificates to the Market for sale to other investors.
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