A stock market, equity market or share marketis the aggregation of buyers and sellers (a loose

network of economic transactions, not a physical facility or discrete entity) of stocks (also called
shares), which represent ownership claims on businesses; these may include securities listed on a
public stock exchange, as well as stock that is only traded privately. Examples of the latter include
shares of private companies which are sold to investors through equity crowdfundingplatforms.
Stock exchanges list shares of common equity as well as other security types, e.g. corporate bonds
and convertible bonds.

Contents

 1Size of the market

 2Stock exchange
 3Trade
 4Market participant
o 4.1Trends in market participation
 4.1.1Indirect vs. direct investment
 4.1.2Participation by income and wealth strata
 4.1.3Participation by head of household race and gender
 4.1.4Determinants and possible explanations of stock market participation
 5History
o 5.1Early history
o 5.2Birth of formal stock markets
 6Importance
o 6.1Function and purpose
o 6.2Relation to the modern financial system
o 6.3United States S&P stock market returns
o 6.4Behavior of the stock market
o 6.5Irrational behavior
o 6.6Crashes
o 6.7Stock market prediction
 7Stock market index
 8Derivative instruments
 9Leveraged strategies
o 9.1Short selling
o 9.2Margin buying
 10New issuance
 11Investment strategies
 12Taxation
 13See also
 14Notes
 15References
 16Further reading
 17External links

Size of the market[edit]

Stocks are categorized in various ways. One way is by the country where the company is domiciled.
For example, Nestlé and Novartis are domiciled in Switzerland, so they may be considered as part of
the Swiss stock market, although their stock may also be traded on exchanges in other countries, for
example, as American depository receipts (ADRs) on U.S. stock markets.
As of mid 2017, the size of the world stock market (total market capitalization) was about US$76.3
trillion.[1] By country, the largest market was the United States (about 34%), followed by Japan (about
6%) and the United Kingdom (about 6%).[2] These numbers increased in 2013.[3]
As of 2015, there are a total of 60 stock exchanges in the world with a total market capitalization of
$69 trillion. Of these, there are 16 exchanges with a market capitalization of $1 trillion or more, and
they account for 87% of global market capitalization. Apart from the Australian Securities Exchange,
these 16 exchanges are based in one of three continents: North America, Europe and Asia.[4]

Stock exchange[edit]
Main article: Stock exchange
A stock exchange is an exchange (or bourse)[note 1] where stock brokers and traders can buy and
sell shares of stock, bonds, and other securities. Many large companies have their stocks listed on a
stock exchange. This makes the stock more liquid and thus more attractive to many investors. The
exchange may also act as a guarantor of settlement. Other stocks may be traded "over the counter"
(OTC), that is, through a dealer. Some large companies will have their stock listed on more than one
exchange in different countries, so as to attract international investors.[7]
Stock exchanges may also cover other types of securities, such as fixed interest securities (bonds)
or (less frequently) derivatives which are more likely to be traded OTC.

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