Exchange (organized market)

An exchange, or bourse /brs/ also known as a trading exchange, is an organized market where (especially) tradable securities, commodities, foreign exchange, futures, and options contracts are sold
and bought.

Contents
1 History
2 Description
3 See also
4 Notes
5 References
6 External links

History
The term bourse is derived from the 13th-century inn named Huis ter Beurze in Bruges, Belgium, where traders and foreign merchants from across
[1] The building, which was established by Robert van der Buerze as a hostelry, had operated from
Europe conducted business in the late medieval period.
1285. Its managers became famous for offering judicious financial advice to the traders and merchants who frequented the building. This service became
known as the "Beurze Purse" which is the basis of bourse, meaning an organised place of exchange. Eventually the building became solely a place for
trading in commodities.

During the 18th century, the faade of the Huis ter Beurze was rebuilt with a wide frontage of pilasters. However, in 1947 it was restored to its original
medieval appearance.

The "Huis ter Beurze" (center) in In the twelfth century, foreign exchange dealers in France were responsible for controlling and regulating the debts of agricultural communities on behalf
Bruges, Belgium. of banks. These were actually the first brokers. They met on the Grand Bridge in Paris, the current Pont au Change. It takes its name from the forex
brokers.

In the thirteenth century, the Lombard bankers were the first to share state claims in Pisa, Genoa and Florence. In 1409, the phenomenon was institutionalized by the creation of the Exchange Bruges. It
was quickly followed by others, in Flanders and neighboring countries (Ghent and Amsterdam). It is still in Belgium and the first building designed to house a scholarship was built in Antwerp. The first
scholarship organized in France was born in Lyon in 1540.

The first documented crash took place in 1636 in Holland.The prices of tulip bulbs reaching excessively high levels, known as theTulip mania. The price collapsed on October 1.

In the seventeenth century, the Dutch were the first to use the stock market to finance companies.The first company to issue stocks and bonds was the Dutch East India Company
, introduced in 1602.

[2]
The London Stock Exchangestarted operating and listing shares and bonds in 1688.

In 1774, the Paris Stock Exchange (founded in 1724), say the courts, must now necessarily be shouted to improve the transparency of operations. In the nineteenth century, the industrial revolution
enables rapid development of stock markets, driven by the significant capital requirements for finance industry and transport. Since the computer revolution of the 1970s, we are witnessing the
dematerialization of securities traded on the stock exchange.

In 1971, the NASDAQ became the primary market quotes computer

. In France, the dematerialization was effective from November 5, 1984.

Description
Exchanges bring together brokers and dealers who buy and sell these objects. These various financial instruments can typically be sold either through the exchange, typically with the benefit of a
clearinghouse to cover defaults, or over-the-counter (OTC), where there is typically less protection against counter-party risk from clearinghouses,[3] although OTC clearinghouses have become more
.[4][5]
common over the years, with regulators placing pressure on the OTC markets to clear and display trades openly

Exchanges can be subdivided:

By objects sold:

Stock exchange or securities exchange

Commodities exchange
Foreign exchange market is rare today in the form of a specialized institution
By type of trade:

Classical exchange for spot trades

Futures exchange or futures and options exchange for derivatives

In practice, futures exchanges are usually commodity exchanges, i.e., all derivatives, including financial derivatives, are usually traded at commodity exchanges. This has historical reasons: the first
exchanges were stock exchanges. In the 19th century, exchanges were opened to trade forward contracts on commodities. Exchange-traded forward contracts are called futures contracts. These
"commodity exchanges" later started offering future contracts on other products, such as interest rates and shares, as well asoptions contracts; now they are generally known asfutures exchanges.

For details, see:

Stock exchange (securities exchange), List of stock exchanges, Category:Stock exchanges

Commodity exchange (futures exchange), List of futures exchanges, Category:Futures exchanges
Foreign exchange market

See also
Commodity market
 Private electronic market
Stock market

Notes
1. Bourse. (http://www.etymonline.com/index.php?term=bourse&allowed_in_frame=0)Online Etymology Dictionary
2. "Sustainable Trade: Changing the Environment the Market Operates in, Through Standardized Global rTade Tariffs" by Zoltan Ban. https://books.google.co.in/books?id=-
Q6mMdieX0EC&pg=PA219&dq=1688+AND+%22london+stock+exchange%22&hl=en&sa=X&ved=0ahUKEwjapLqesObP AhXpz1QKHQlTA2o4ChDoAQgyMAA#v=onepage&q=1688%20AND
p. 219.
3. Stock Exchanges are the most publicly recognized places for buying and selling shares. They are easily the single most important component of the secondary market for
corporate shares. Over-the-Counter Options(http://beginnersinvest.about.com/od/stocksoptionswarrants/a/over-the-counter-options.htm)
. About.com.
4. OTC Clearing 'FIX'ed Up(http://fixglobal.com/home/otc-clearing-fixed-up-2/)
. FIXGlobal.
5. A Focus on OTC Clearing Innovation(https://www.theice.com/publicdocs/ice_trust/Global%2520Investor%2520Magazine.pdf). IntercontinentalExchange.

References
Webster's New World Finance and Investment Dictionary
http://boersenlexikon.faz.net/boerse.htm
http://www.britannica.com/EBchecked/topic/128089/commodity-exchange

External links
"Bourse". Collier's New Encyclopedia. 1921.

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