You would trade stocks through some of the most well known stock exchanges market like the NASDAQ, AMEX, NYSE, AMEX, OTCBB, HONG KONG exchange and LONDON exchange. These are markets that are available for stocks trading between sellers and buyers. Trading can also take place online or via computers.
The market of the exchanges allows buyers and sellers to come together. This makes it easier to sell and buy due to the location. It’ll be harder to buy or sell if you have to look for buyers on your own around your city. The NYSE or the New York Stock Exchange market is one of the most prestigious exchanges in the world. Stocks are traded on an auction basis sometimes where the highest bidder wins the stocks. Some of the largest companies on the NYSE are General Electric, McDonald’s, Citigroup, Coca-Cola, Gillette and Wal-mart. A broker will be the person that does the selling for the investor. After a sell has been made, the broker will notify the investor.
The Nasdaq is also another market for stock exchange. The Nasdaq is an OTC or over the counter exchange type. Most trading takes place via the computers and phones. The Nasdaq is the home of major computer companies like Microsoft, Cisco, Intel, Dell an Oracle. This makes them a big competitor to the NYSE. There’s no central location to trade and it can be on the computers. They do match up buyers and sellers directly.
The third largest exchange is the American Stock Exchange or AMEX. The NASD bought AMEX in 1998. Trades at AMEX are small cap and derivatives.
There’re two other major exchange markets and those are the London Stock Exchange and the Hong Kong stock exchange. The OTCBB or over the counter bulletin board is where penny stocks are trade. There’s little regulations and higher chance for fraud with OTCBB.