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3..3.

Name: Farid ullah & Tahir Mehmmod Class: MBA Semster: 2nd Reg:MBA (M) 426 & 453

How Securites are traded at stock exchange

Stock Exchange?
Stock Exchange is a market place where securites of listed thereon are bought and sold for either investment or speculation. OR A stock exchange is a form of exchange which provides services for stock broker and traders to trade stocks,bonds, and other securites.

Stock Exchange in Pakistan

There are three stock exchange in Pakistan

Karachi Stock Exchange

Islamabad Stock Exchange

Lahore Stock Exchange

How Business is Transacted at Stock Exchange

Choosing a Broker Placing an order Making the contract Share Position Settlement

Choosing a broker
Trading in the stock exchange is done by the broker who are the registered member of the stock exchange... A broker is a person whose sole business is to buy and sell shares for clients and charge nominal commission on them

Placing an order
The intending investor places an order for the purchase or sales of shares to the broker either on telephone or going personaly to his chamber.

Continue..........
Types of Orders 1) Market Order buy or sell order to be executed immediately at the market price actual price may vary because of order volume or trading inside the quoted spread 2) Limit Orders investors specify prices at which they are willing to buy (limit-buy) or sell (limit-sell) 3)Stop-Loss stock is sold when its price falls below a limit stop-buy order = opposite transaction (used with short-sales)

Making the contract

The purchase and sale of shares is done through computer network in trading floor.......the order for the number of shares to be purchase , their bid prices are recorded on the computer organized by stock exchange

Share position
When the sales or purchase of shares is settled, the broker prepares and complete the customer ledger which contain the foolwing information.. Name of the customer Total quantity of shares sold by him Their amont to be recieved by him Total purchases with amount etc..

Settlement
The purchase and sales of transection is made either on cash (spot transection) on account basis. In case of spot transection the transection is settled on payement of cash .the payment is to be made with in 24 hours of bargain.if transection is on account basis, the payment is to be made within specfied period announced well in advance...

Refrences
Professor M.Saeed Nasir Wikipedia (http://en.wikipedia.org/wiki/Karachi_S tock_Exchange) FINVIZCOM (finviz.com/store/how-tochoose-a-broker.ashx) http://beginnersinvest.about.com/od/cho osingabroker/Choosing_a_Broker.htm http://www.kse.com.pk