S T O C K M A R K E T
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TRADING PAGE 2
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TRADING HISTORY OF THE STOCK IMPORTANCE OF THE STOCK BEHAVIOR OF THE STOCK STOCK EXCHANGE ROLE OF STOCK EXCHANGE AMERICAN STOCK EXCHANGE AUSTRALIA ST EXCHANGE LONDON STOCK EXCHANGE BOMBAY STOCK EXCHANGE KUWAIT STOCK EXCHANGE NYSE HONG KONG STOCK EXCHANGE HOME PAGE There is a specific person known as the specialist whose job is to match buy orders and sell orders. Prices are determined using an auction method known as "open outcry": the current bid price is the highest amount any buyer is willing to pay and the current ask price is the lowest price at which someone is willing to sell; if there is a spread, no trade takes place. For a trade to take place, there must be a matching bid and ask price. (If a spread exists, the specialist is supposed to use his own resources of money or stock to close the difference, after some time.) The Nasdaq is a virtual (listed) exchange, where all of
the trading is done over a computer network. The process is similar to the
above, in that the seller provides an asking price and the buyer provides a
bidding price. However, buyers and sellers are electronically matched. One
or more Nasdaq market makers will always provide a bid and ask price at
which they will always purchase or sell 'their' stock. The Paris Bourse, now
part of Euro next is an order-driven, electronic stock exchange. It was
automated in the late 1980s. Before, it consisted of an open outcry
exchange. Stockbrokers met in the trading floor or the Palais Brongniart. In
1986, the CATS trading system was introduced, and the order matching process
was fully automated.
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