Question

From the following, identify the one which is not a function of the stock exchange:

• A. Providing liquidity and marketability to existing securities.
• B. Spreading of equity cult.
• C. Ensuring the safety of transactions.
• D. Ensuring that there is no scope for speculation.

Hint:

Stock exchanges enhance liquidity and investor confidence but cannot fully eliminate speculation.

Answer 1

The Correct Option is D

Step 1: Functions of a Stock Exchange A stock exchange provides liquidity, ensures safety, and promotes investments. Step 2: Analysis of Statements - (A) Stock exchanges are crucial for the liquidity and marketability of securities. - (B) Stock exchanges promote public engagement in equity investments. - (C) Transactions are regulated to ensure safety. - (D) Stock exchanges cannot eliminate speculation, as it is inherent to market operations. Conclusion: The correct option is (mathbf{(D)}), acknowledging that speculation is an intrinsic element of all financial markets.