The stock market and stock exchange can be confusing because it is so similar, and at the same time, it is different. Today, we will be discussing their differences, and in doing that, we would have to know their individual definitions.
The stock market refers to companies that put out their shares for investors to buy. It is an official association that permits business establishments to make a list of their shares and put them up to sell to the public. It helps to make buying and selling run smoothly.
The stock exchange is where brokers and traders buy and sell that is based on the rules and regulations. The stock exchange is an association or organization that hosts a market where stocks and commodities are traded.
These are some of the differences between the stock exchange and the stock market.
- The stock market is an assemblage of stock exchanges, where the transactions for selling of securities, issuing, and purchasing take place. In comparison, the stock exchange is a place whereby traders and brokers gather to sell and buy securities.
- The stock market has a broad range as it is in accord with numerous stock exchanges. In contrast, the stock exchange has an insular scope because it is part of the stock market.
- For the stock market, the volume of trading is usually large. While on that the stock exchange, the volume of trading is generally smaller.
- For the stock market, they do not work as a clearing house. Meanwhile, the stock exchange works as a clearing house.
- The number one objective of a stock market is to be the meeting place where traders come to conduct their trading activities. While stock exchange work with the motive of earning profits from the exchange between investors as they trade.
