What is the stock exchange and how does it operate?

The stock exchange is a marketplace where securities, such as stocks and bonds, are bought and sold by investors. Exchanges, like the New York Stock Exchange (NYSE) or the London Stock Exchange (LSE), provide a platform for companies to raise capital by issuing shares to the public. Investors can buy and sell these shares, allowing them to take ownership in a company. The prices of securities on the exchange are determined by supply and demand, and market participants can make transactions through brokers. Stock exchanges play a key role in global financial markets by providing liquidity, transparency, and price discovery.