LISTED SECURITY

An investment instrument that is traded in an exchange such as the New York Stock Exchange and Nasdaq. The financial instrument being traded include stock, bond, derivative, ETFs, and mutual funds, among others. Should a private company decide to go public and issue shares, the company needs to choose an exchange where it wants to be listed. In order to be listed on an exchange, the firm must comply with the exchange’s listing requirements and needs to pay its entry and yearly listing fees. The requirements vary from one exchange to another, which includes minimum stockholder’s equity, minimum share price, and minimum number of shareholders. Exchanges make sure that only high quality securities are traded on them and they uphold their reputation among traders.

Also known as listed investment or quoted security.