Nigerian Stock Exchange - JSS3 Social studies Past Questions and Answers - page 2

The Securities and Exchange Commission (SEC) is a regulatory body responsible for overseeing and enforcing securities laws to protect investors, ensure fair markets, and support capital formation.

Owning a share in a company means having ownership in that company. Shareholders benefit by having the right to a portion of the company's profits and potentially participating in decision-making through voting rights.

The NSE facilitates market activities by providing a platform for buying and selling securities, ensuring fair and transparent transactions. This is crucial for maintaining market efficiency and fostering investor confidence.

Securities offer avenues for investment, allowing individuals to potentially earn returns. Moreover, they enable risk diversification by spreading investments across different assets, reducing the impact of individual asset volatility.

The NSE facilitates capital formation by allowing companies to issue new shares, raising funds for various purposes like expansion and projects. This is crucial for companies to grow and thrive in the market.

Liquidity is vital as it allows securities to be easily bought or sold in the market. This benefit provides investors with flexibility, enabling them to enter or exit positions more efficiently, contributing to a more dynamic and responsive market.