Hanoi Security Exchange

I. UNDERSTANDING THE SECURITIES EXCHANGE

1. DEFINITION AND FUNCTIONS OF THE SECURITIES EXCHANGE

1.1. Definition

A highly organized market facilitating the purchase and sale of securities and operated by professional stockbrokers and market makers according to fixed rules. Securities listed on stock exchanges are common stock of the large companies which have experiences and meet the requirements and criteria according to the rules of trading methods, time and specific location.

1.2. Characteristics

- Stock Exchange is the meeting place of the brokers to negotiate the purchase and sale of securities, facilitate the securities transactions.

- Stock Exchange has no goods and the last purchasers or buyers, only the brokers, because in many countries, the common stocks are deposited in the bank.

- The SE helps transfer funds easily and quickly from one person to another one.

1.3. Functions

- To increase the liquidity of the issued stocks. Through the Stock Exchange, the issued securities are traded continuously, the issuers can raise capital through the stock market, and investors can purchase listed securities easily and quickly

- The function of determining prices. Prices are determined on the basis of matching buy and sell orders for securities and market supply and demand. SE helps create a free and fair market

2. MEMBERS OF SECURITIES EXCHANGE

2.1. Overview

SE members are mainly brokers or dealers who engage in transactions through the computerized trading system.

2.2. Classification

For the developed stock market, members are divided into several categories based on their functions:

+ Experts

+ The member company's brokers

+ Independent brokers

+ The bond brokers

2.3. Rights and obligations

- Rights: Members are allowed to transact and use means of transaction on the SE to carry out the transaction process. However only official members have the voting right and receive the assets of SE in case of dissolve.

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