Three functions performed by the Stock Exchange are:
(i) Providing liquidity and marketability to existing securities, as the stock exchange creates a continuous market where the securities are bought and sold. It gives investors the chance to disinvest and reinvest. ‘It creates a continuous market where the securities are bought and sold. It gives investors the chance to disinvest and reinvest.’
(ii) Contributes to economic growth, as through process of disinvestment and reinvestment, savings get channelised into their most productive investment avenues. ‘Through this process of disinvestment and reinvestment, savings get channelised into their most productive investment avenues.’
(iii) Safety of transactions, as the membership of the stock exchange – is well regulated and its dealings are well defined according to the existing legal framework. This ensures that the investing public gets a safe and fair deal on the market. ‘Membership of the stock exchange is well regulated and its dealings are well defined according to the existing legal framework.’
