4. STOCK EXCHANGE
A facility where stock brokers and traders can
buy and sell securities, such
as shares of stock and bonds and other
financial instruments.
5.
6. Trading Procedure on Stock
Exchange
1) Selection of Broker:
Abroker is amember of stock exchange and securities canonly
be purchased and sold through him
2) Placing the Order:
There are three parties involved in the dealing ofshares:
Thestock Broker
Theclient
Thejobber (market maker)
Thestock broker simply acts asagent and contacts the
particular jobber in the stock exchange on behalf of the
client
7. 3) Preparing the contract note:
The stock broker prepares the contact note that contains the
following information:
Name and the address of the stockbroker
The name and address of the jobber
The type and price of the share
The commission of the broker
The date of transaction
4) Settlement:
In case of ready delivery contract, the buyer pays the money
andthe seller delivers the securities one sameday
In the case of forward delivery contract settlement are done ina
week or once in amonth.
8. ROLES OF STOCK
EXCHANGES
Raising capital for businesses.
Mobilizing savings for investment.
Facilitating company growth.
Opportunities for small investors.
9. Stock prices up and down
Company doing good or bad business
Financial results and bright or depressive
expectations
Players go for buying seeing rapid growth
or selling anticipating depressed earnings
New innovative product launched
10. Selection 100 KSE index
The selection criteria for stock inclusion in the
recomposed KSE 100 Index are:
SECTOR RULE
Largest market capitalization in each of the 34
sector of the Exchange, excluding Open – end
Mutual Fund sector;
CAPITALIZATION RULE
The remaining 66 companies are taken up on the
basis of market capitalization
11. Process to list company
The application for listing shall be made
accompanied by the documents as mentioned
in
The Board may require additional evidence
declarations, affirmations and information
If an application together with the additional
information is not submitted, the Board may
defer consideration or decline
Applicat must furnish information as exchange
may require time to time
12. Documents required with
application
Listing application
Form of submission and payment of fees
An undertaking regarding updating of daily offer price
Certificate of Incorporation
Certificate of Commencement of Business of
Management Company
Board Resolution of the Management Company for
listing of the Fund
Names of Directors of Management Company along
with directorship of other companies listed on the
Exchange
13. Continue..
Memorandum & Articles of Association
Audited accounts for the last 5 years
Confirmation that none of promoters /
sponsors / directors which are also promoters /
sponsors / directors in other Listed
Companies, are quoted in the Defaulters
Segment
Name and address of the directors and
persons holding ten per cent or more of any
class of equity security in the Management
Company
14. Listing shall not be entertained
Whose ceo has been found to have violated the
Listing Regulations of any others/listed company
on the Exchange in which he had been the Chief
Executive.
Whose promoters/sponsors/controlling directors
are in the defaulters list of State Bank of Pakistan
A running company for one full year or more,
reflecting losses in its last audited accounts, shall
not qualify for listing if its equity is eroded by 40%
or more.
No Company will be listed unless it is registered
under the Ordinance as a public limited company
and its minimum paidup capital is Rs.200 million