To be an investor, there are certain places and terms that
you need to familiarize yourself with. One of those places is the stock
exchange.
There are numerous stock exchanges that you can find all
over the world. The companies that you wish to invest in can be found in these
exchanges if they are listed in them.
In this article we’ll be discussing with you the different
stock exchanges that you can find across the globe. But before that, let’s
answer the question: what is a stock exchange?
What is a Stock Exchange
A stock exchange is an institution or organization where
you’ll be able to find the markets where stocks, bonds, options and futures, as
well as commodities are being traded.
During certain times within business hours, you’ll find buyers
and sellers together in the market. Exchanges are the ones responsible for
enforcing rules and regulations on the firms and brokers involved with them. If
you find a certain company in the exchange, it means that people will refer to
it as “listed”.
Learn more about the difference between stocks and forex.
The stock exchange also makes it possible for you to buy or
sell securities without even personally knowing the person on the other end of
the trade. They can be halfway across the globe, yet you are able to trade with
each other. This, the need for convenience, is what actually drove the
establishment of the biggest stock exchange in the world.
There are securities that are not listed in any exchange;
these companies are often found and sold OTC or Over-the-Counter.
5 of the Biggest Stock Exchanges Found
Across the Globe
New York Stock
Exchange
The New York Stock Exchange or the NYSE is part of the NYSE
EURONEXT. According to its estimates, the NYSE represents one-third of the
total equities traded globally. It continues to be one of the primary exchanges
in the world and the largest when it comes to the almost $10 trillion in stock
market capitalization it represents.
The NYSE is estimated to have been established in 1792 with
the Bank of New York, now a part of Bank of New York Mellon, being the first
traded stock.
London Stock
Exchange
The London Stock Exchange or LSE is one of the top five
stock markets in the world. It has an estimated $2.2 trillion in stock market
capitalization from the companies listed on its exchange. It was estimated to
have been established in 1801, almost a decade after the founding of the NYSE.
There are around 3,000 companies from across the globe being
traded on the LSE and its affiliated exchanges, giving it the self-proclaimed
title of most international of global exchanges.
Tokyo Stock
Exchange
The Tokyo Stock Exchange or TSE is the largest exchange that
you can find in Japan. The TSE is believed to have been established in 1878 and
are partners with other exchanges around the globe. One of the primary and most
popular indices that represent some of Japan’s largest and most successful
firms is the Nikker 225 index.
It’s also ranked second, behind the NYSE, when it comes to
the more than $3 trillion in market capitalization denoted by the 2,000 firms listed
on its exchange.
Hong Kong Stock
Exchange
The Hong Kong Stock Exchange qualifies to be one of the 10
largest stock exchanges in the world. The roughly 1,500 companies listed on the
Hong Kong Stock Exchange denote almost $2 trillion in total market
capitalization.
The first operation of the Hong Kong Stock Exchange dates
back to just prior to 1900. It also acts as one of the primary avenue for
global investors to invest in China.
Shanghai Stock
Exchange
The Shanghai Stock Exchange is one of the newest exchanges
in the world having opened in late 1990. It also has 1,500 companies being
traded on its exchange. The trading volume on this exchange continued its rise
until a dramatic fall which began in 2008, the year which marked a peak in term
of investment interest in China.
One of the major restrictions in the exchange is that “A”
shares of Chinese companies can only be exchanged by local residents of China.
Hong Kong has “H” shares left open to global investors.
Conclusion
There are numerous stock exchanges you can find around the
world, you just have to identify the company you’d like and find the stock
exchange it belongs to. Just remember to learn as much as you can about the
stock exchanges before getting involved in it.
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