Dramatic developments had occurred in
this century was have a significant impact on the emergence of global companies
either agricultural or industrial, which are characterized by complexity of
economic transactions and this complexity required to create several types of
financial markets and stock exchanges to facilitate exchange transaction and
creating a kind of flexibility and speed of these transactions, and the
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| types of stock markets |
most
important of these exchanges and (not all ) we can find :
stock exchange of goods:
this is one of the oldest stock
exchanges where it is dealing with agricultural crops, and can be defined as an
organized market where trading based on big consuming natural products, and
this stock exchange specialize on goods and tangible goods only.
The most important cargo exchanges
currently:
-Liverpool
stock exchange in barley material.
-LSE
(London) and Paris (Paris) in coffee and sugar.
Goods like the securities market have
a spot and future markets and it is known that any contract or business
transaction is presumed that the parties agree on the following things:
• for the
product: quality, quantity, unit price.
• for
delivery: date or period, shipping way.
• for
type: immediate or deferred.
the goods stock exchange is divided into two types:
1-exchange spot contracts: (immediate(
The theme of this market is to avoid
that the goods are ready and present actually in stores and warehouses, in
addition to another point, the possibility to examine the goods.
2-Futures Stock exchange:
Its theme is the bilateral contracts
include commitments based on goods and model actually not exists and can be
disposed by paying the price difference and this process needs expertise...
-For example, on the Paris Bourse was being dealt to a certain
type of vines and a special type of flour, it must address the content of
advance contracts a limited minimum amount for dealing.
Spot transactions, unlike futures
markets where buyer can not preview the goods.
Below we are going to mention the
role of stock exchange of goods and of essentially eliminate the risk of
fluctuations in commodity prices resulting from the process of supply and
demand, and to face these threats using the method of arbitration (Arbitrage),
namely:
1-Arbitration process requires two
different opposite transaction in the spot and futures market and this can be
done by the integration process of the goods with the contract (purchase or
purchase contract)
2-securing
necessary goods with reasonable prices (to ensure plant consumption for several
months with a note that the contract price is less than the current price of
the goods was his surest purchase contracts with a view to liquidation in the
future and the same thing in selling contracts)
3-core work is extrapolated futures
price.
4-goods Exchange stock produce the
world price of goods thanks to means of communication and transportation in the
world.