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Australian Stock Exchange - Essay Example
Finance & Accounting
Pages 7 (1757 words)
Australian Stock Exchange Introduction Company requires funds either when it is founded or when it is expanding. One of the ways of acquiring funds by an already existing company is through investments. The investments by investors are made in the form of stocks…
This is done either to remove risks or to obtain a profit. According to Becket (2012), stock exchange is a public place where a company can sell its shares to investors or where an investor can buy or sell shares to another investor. Australian Stock Exchange is one of such places used for trading stocks. This paper explains an evaluation of this market and discusses the importance of the market to the Australian economy. The Australian Stock Exchange manages all the activities related to trading of shares in Australia. The activities concern both primary and secondary services required by companies and investors in the trading of shares. This includes capital information and hedging, trading and price discovery, risk transfer, and securities settlement (ASX, 2012). This stock exchange has been ranked among the largest in the world in terms of market capitalization. According to Downers and Masci (2003), the Australian Stock Exchange was in the past converted from a mutual organization to a company. Due to this, it expanded its regulations and incorporated public interests in its operations. Moreover, it became more accountable to the members of the public. This is because the public is its main owner. One of the major responsibilities of this stock exchange is to distribute necessary information to companies, current shareholders, and potential shareholders. ...
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