(Difference between revisions)
Revision as of 12:02, 29 June 2005
An exchange is simply a market in which securities, commodities, options, or futures are traded. There are auction based exchanges, which means specialists are physically present on the exchangesÃ¢â¬â¢ trading floors. Each specialist "specializes" in a particular stock, buying and selling the stock in a verbal auction. These specialists are under competitive threat by electronic-only exchanges that claim to be more efficient (that is, execute faster trades and exhibit smaller bid-ask spreads) by eliminating human intermediaries.