Raising Capital: With the Risk or Reward

By 1920, volume had increased to 3 million shares, and, by 1926, a second, parallel industry had emerged for issues which had been judged too young or too speculative to your Montreal Exchange. This parallel marketplace traded over a sidewalk outside the exchange and was thus referred to as the Curb Market; in 1953, the Curb Market formally became the Canadian Exchange, which merged on the Montreal Exchange in 1974 (Michie, 1988, p. 57). Organization with the Montreal Exchange The Montreal Exchange is part in the bigger Canadian Stock Market, which includes exchanges in Toronto, Vancouver, Albert and Winnipeg along with Montreal.

The industry is set up so that buyer orders are traded from a single central industry offer where costs are established. This central marketplace generates quotes for all clients and sellers according to offer and demand. In 1996, the Montreal Exchange was the 11th largest inside world, with over 550 listed organizations and $638 billion in total capitalization. More than 17 million shares are traded daily, and more than 3.4 million futures contracts and 834,000 options were traded during 1996 (Montreal Stock Exchange, 1997a, p. 8). The Montreal Exchange trades stocks and bonds along with futures contracts and choices on every of these. Choices are securities which give the purchaser the right, but not the obligation, to purchase or market a certain amount of securities at a Montreal Stock Exchange. (1997). History. Net address: http://www.me.org/en.his1.html.

The Montreal Exchange is composed of more than 80 member brokerage corporations whose representatives conduct the genuine trading. Independent traders can preserve restricted permits which enable them to carry out transactions for themselves only over a floor in the Exchange; these independent traders can't conduct transactions on behalf of any other persons or groups without having acquiring broker status. To be an independent trader, somebody need to be at least 18 including a Canadian citizen or legal resident and pass all exams set up by the Exchange for this purpose. In addition, the person need to have a net worth of at least $25,000 and an agreement with an accredited clearing residence to facilitate trades.

The person need to also be registered of the Commission des valeurs mobilieres du Quebec, the agency responsible for controlling the securities industry in the province (Montreal Stock Exchange, 1997a, p. 6). fixed cost for a predetermined amount of time. Futures contracts are contracts under which a consumer agrees to take possession of a specific amount of a product or service at a predetermined cost and time, plus a seller agrees to supply the same. Besides producers who may possibly need to protect themselves from marketplace fluctuations from the use of futures contracts, these contracts are also traded by speculators who profit (or lose money) on changes in product value.

The Montreal Exchange has come to be a well-liked market for derivatives, a particular type of futures contract according to bonds and acceptances (Dugan, 1990, p. C24). A company which desires being listed on a Montreal Exchange must meet a series of needs regarding financial stability, development stage, strength of management and other criteria.

Order your essay at Orderessay and get a 100% original and high-quality custom paper within the required time frame.