Glossary · Defined term
Exchange
A stock exchange is a regulated marketplace, like the NYSE or Nasdaq, where buyers and sellers trade securities.
Last updated Oct 2, 2026
What it means
A stock exchange is a regulated marketplace where buyers and sellers trade securities, with the New York Stock Exchange and Nasdaq the two largest in the United States. Exchanges set listing standards that companies must meet, provide the systems where prices are discovered through competing orders, and ensure trades clear and settle properly. Listing on a major exchange gives a company visibility, credibility, and access to deep pools of investor capital. Exchanges earn revenue from listing fees, trading fees, and market data. For investors, an exchange listing generally means a stock can be bought and sold easily during market hours.
An example
For illustration, when a company completes an IPO, its shares begin trading on an exchange such as the NYSE under a ticker symbol. From then on, any investor with a brokerage account can place an order that the exchange matches with a seller. The exchange itself does not set the price; competing buyers and sellers do.