Role of Stock Exchange

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The role of stock exchanges in the economic development of the country Introduction: This research is based on the role of stock exchanges in the country and its part in the development of the economics of the country. Stock market is an essential part of capital market. The economy of every country largely depends on a strong capital market. Contribution of any stock exchange generally leads to economic growth by increasing the funds to finance industry and other enterprise. Stock exchange is an independent company formed by shareholders members. It can take various decisions independently. The objectives of stock exchange is to provide a market place along with facilities for together the buyers and sellers of securities, promote just and equitable principles of trade, protect the interest of the investors. A complete automation project of stock exchange is on full swing. Considering the important the role of stock exchange in development of capital market of any country, is an attempt, has been in this terms paper to study the contemporary practices of stock trading in stock market. Research Objective: Investigate the role of stock exchange in the economic development of the country Literature Review: Leroy and Porter 1981 Before the decade of eighty much of the stock market literature viewed the present value of dividends to be the principal determinant of market return of stocks found that under the assumption of constant discount factor stock prices were too volatile to be consistent with movement in future dividends. The decomposition of stock price movements is very sensitive to what assumption is made about the presence of permanent changes in either real dividend growth or excess stock return. Carlos & Davila 2001 One of the main purposes of the stock exchange is to provide a platform for the new born companies and existing ones to raise

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