Explain Mechanics of security trading in Stock Exchange
Introduction: An investor should have some knowledge of how the securities markets operate. Marketing of old or new securities on the stock markets can be done only through members of Stock Exchange. These members are either partnership firms or individuals. An individual; should use the facilities of these members for trading insecurities unless he himself is a registered dealer or member of an organized stock exchange. Trading among members of a recognized stock exchange is to be done under statutory regulations of the stock exchange. Members carrying on business are known as 'brokers' and can trade only on listed securities. These members execute customer's orders to sell and buy on the exchange and their firms receive negotiated commissions on those transactions.