The order book and matching
The order book is central to an exchange: a continuously updated list of the prices at which participants are willing to buy and sell. A matching process pairs compatible buy and sell orders and records the resulting trades. Because all orders are posted to the same book, the exchange produces a single continuous price for each asset, a process known as price discovery.
Transparency and rules
Two characteristics typically define an exchange. The first is transparency: quotes and trades are published so that all participants observe the same prices. The second is a defined rulebook governing which assets may be listed and how trading is conducted, usually under some form of oversight. Together these make an exchange a structured and accountable marketplace, which is one reason exchange prices are widely used as references.
Exchanges and other venues
An exchange is not the only way to trade. In dealer or over-the-counter markets, trades are negotiated directly between two parties rather than matched in a central book. Some asset classes are concentrated on exchanges, while others trade largely away from them. Neither model is superior in general; each suits different instruments and requirements, and many assets trade across both.
Why an exchange price is one view
Even a large exchange is a single venue. When an asset trades on several exchanges as well as off-exchange, no individual exchange holds the entire market, and their prices can differ slightly at the same moment. For this reason a representative market price is generally derived by reconciling many venues rather than taking the price from one exchange.
Beyond a single exchange on SiftingIO
SiftingIO does not rely on any single exchange's feed. For each asset it draws quotes from multiple independent venues, filters outliers, and publishes one aggregated fair price under a documented method, providing a representative market price rather than the view of one exchange. For exchange-listed markets such as US stocks, the same normalized schema carries quotes, trades, and history.