Question

Write an essay on why you think no mechanism is required to increase competiton in a stock exchange (monopoly) ?

Answer 1

Mechanism refers to a natural or established process by which something takes place or is brought about.Is mechanism really needed to increase the competition in stock exchange.? let us first now what stock exchange means.A stock exchange or securities exchange is an exchange (or bourse)[note 1] where stock brokers and traders can buy and sell securities, such as shares of stock and bonds and other financial instruments. Stock exchanges may also provide facilities for the issue and redemption of such securities and instruments and capital events including the payment of income and dividends.[citation needed] Securities traded on a stock exchange include stock issued by listed companies, unit trusts, derivatives, pooled investment products and bonds. Stock exchanges often function as "continuous auction"markets with buyers and sellers consummating transactions at a central location such as the floor of the exchange.

Growing importance of technology have made stock exchange very much competitive. The business operations and capital flows are becoming increasingly globalized as new centers of economic strength and innovation develop around the world. Also the future market-leading companies are springing up in such places as China, India, Korea and Eastern Europe, in addition to the mature economies of the US, Europe and Japan. While the majority of companies ultimately choose to list on their domestic stock exchanges, more and more business leaders today are considering the pros and cons of accessing public capital in a foreign market.n fact Stock exchanges are also restructuring themselves to take advantage of the global opportunities that arise in this environment—whether by pursuing new listings from abroad or accessing foreign markets through mergers, acquisitions and strategic alliances. The modern corporate house have many options to consider when selecting a stock exchange for an initial public offering.

  The race is always from the top. The major stock exchanges like the Australian Securities Exchange, Deutsche Börse, Euronext, Hong Kong Stock Exchange, London Stock Exchange, NASDAQ, New York Stock Exchange, Singapore Stock Exchange and Tokyo Stock Exchange are making themselves more and more credible so that the business leaders prefer them.hese stock exchanges are redesigning themselves. These stock exchanges strategic focus is to improve the types of exchange-listed companies and IPO activity, listing standards and fees, the process and timeline of going public and the regulatory environment. Even the disclosure norms and listing standards, fees and regulatory environment are also being changed to make them contemporary.Thus in the entire process it is not neeeded.