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Chapter 15 - • Over-the-counter(OTC market an electronic...

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Chapter 15A: Investing in Stocks Chapter Objectives Identify the functions of stock exchanges Describe how to interpret stock quotations Explain how to execute the purchase or sale of stocks Explain how to analyze a stock Stock Exchanges Stock exchanges: facilities that allow investors to purchase or sell existing stocks New York Stock Exchange Most popular organized exchange in U.S. Floor traders: traders at a stock exchange who execute trades to fulfill orders placed by other investors Specialists: traders who help to make a market in one or more stocks by taking the position opposite of orders placed by clients Other stock exchanges American Stock Exchange Lists about 800 stocks that are generally smaller and less actively traded
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Unformatted text preview: • Over-the-counter (OTC) market: an electronic communications network that allows investors to buy or sell securities Market-makers: traders who execute trades on the OTC market and earn commissions in the form of a bid-ask spread Less stringent listing requirements than for NYSE Electronic Communication Networks (ECN): computer systems that match up desired purchases and sales of stocks Allow for after-hours trading • Stock Quotations • Price quotations readily available from the Internet, stock brokers or financial newspapers • Provide information about the price of each stock over the previous day or a recent period • Purchasing or Selling Stocks...
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