The Role and Function of Stock Market - Assignment Example

For each transaction, the stock market plays its role as a defrayal-house which means that it assembles and distributes the shares with an assurance of reimbursement to the customers. Therefore, the illegal influence of counterparty on the transaction is eliminated to an investment whether invested by an investor or corporation. The smooth execution of stock market activities not only helps profitable development at lower costs but also projects the production of the industry as well as employment.

Moreover, the inoperative deposits with banks are used for the cultivation of various economic sectors such as agriculture, commerce, and trade. Thus, by playing its vital role in promoting the economic system, it also increases the societal prosperity in the state.Generally, the stock markets consist of a board of directors, chief executive officer (CEO), deputy chief executive officer (DCEO) and heads and staff of departments and sections. The general administrative structure of stock markets is as follows:(iii) It also suggests the most suitable solutions to business problems and prepares trading announcements.

Moreover, it is responsible to ensure that these reports must reach the concerned parties, trading system operators and conducts the required investigation to license them to function.It is a sub-market of the London Stock Market. Here smaller companies and corporations float their shares in a flexible regulatory system which is generally available in the Main Market. The Alternative Investment Market (AIM) was launched in 1995 and so for it has risen more or less £24 billion for more than 2,200 companies and corporations.

In the last few years, a significant number of companies have been transferred from the Main Market to the AIM. One of the biggest reasons is the AIM of noteworthy tax compensations for investors and a lesser amount of regulatory load on the companies.