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20 August 2011

World Stock Exchanges

Stock markets

Stock market (market of securities, debentures and other paper holdings) - part of the capital market; market of securities involved in any stocks as well as over the counter (OTC Market).
Stock market is an abstract notion defining the whole set of actions and mechanisms which make it possible to trade securities (stocks, bonds etc.). You should not mistake this term for the notion of stock exchange, which is the organization with the following aims: providing a place for conducting trading deals and arranging the co-operation of the buyers and sellers of securities.

New York Stock Exchange - the main stock exchange in the USA, the largest one in the world. The symbol of the US financial power and of the entire financial industry. In New-York, the worldwide-known Dow-Jones index for shares of industrial companies, as well as the NYSE Composite index are defined.
NYSE Composite - one of the most popular stock indices in the world. It reflects the rate changes of all shares, quoted on New-York stock exchange, including over 1500 American largest companies with the total capitalization of more than $20 billion. That is why NYSE Composite can serve as an indicator of the USA economy.

The stock exchange was founded on the 17th of May, 1792. Since 1975 it has become a non-commercial corporation, owned by 1336 members (this figure is unchanged since 1953). The membership can be bought; the price for it has reached $3 million.
In early May of 2006 the NYSE mergered with the electronic stock exchange Archipelago Holdings and for the first time offered its shares to investors, thus becoming a commercial organization.
Share trading of the NYSE Group is held on the stock exchange; the capitalization for beginning of March 2006 amounted to $12,5 billion. The operations with over a thousand of securities and shares are conducted here. Total capitalization of the companies trading on the NYSE was $26,5 trillion at the end of 2006.
Working hours: 1:30 p.m. - 8:00 p.m. (Monday-Friday) GMT
2:30 p.m. - 9:00 p.m. in winter (Monday-Friday) GMT
NASDAQ (abbreviation for National Association of Securities Dealers Automated Quotation) - American off-exchange market, specialized in shares of high-technology companies (electronics, software production and etc.). One of three major US stock exchanges (together with the NYSE and the AMEX), is a unit of the NASD, regulated by the SEC. The owner of stock exchange is the American company called the NASDAQ OMX Group. Apart from NASDAQ, it also owns 8 European stock exchanges.
At the given moment more than 3200 companies including Russian companies are trading at NASDAQ.
A regular NASDAQ trading session opens at 9:30 a.m. and closes at 4:00 p.m. (Eastern Time). Trading operations are held on the basis of such platforms as SuperMontage and Primex. After the end of the regular session it is possible to continue the trade till 8:00 p.m. using the platform SelectNet. The scheme according to which the trading is conducted on the NASDAQ stock exchange differs from a traditional one. Several market-makers are competing for the execution of the clients' orders. Currently there are about 600 market-makers here. The main function of a market-maker at NASDAQ (as well as at NYSE) is the uninterrupted quotations providing and maintaining liquidity of certain shares group during the trading. A market-maker must execute an order at its own cost in case there is no corresponding opposite order on the market. Some market-makers support hundreds of shares, others - thousands. As a result, at an average, some types of shares are supported by 14 market-makers, other shares’ types - up to 50. The NASDAQ quotations are the result of quotation correlation, provided by market-makers and alternative trading systems.

Working hours: 1:30 p.m. - 8 p.m. in summer (Monday-Friday)
2:30 p.m. - 9:00 p.m. in winter (Monday-Friday)
New-York Merchantile Exchange (NYSE: NMX) founded in 1872, takes the first place in the world in the oil futures trading. Contracts for oil, gas, platinum, palladium, gold, silver, copper and aluminum are traded on this stock exchange. According to the data of the Futures Industry Association in 2006 216 billion of deals were executed here. In 2006 the NYMEX profit was equal to $497.3 billion, the net profit - $154.8 billion. The capitalization - $11.4 billion.

London Stock Exchange - one of the biggest and the oldest European stock exchanges. Officially it is established in 1801, however, its history dates back to 1570, when the king's financial agent and adviser Thomas Gresham built the "Royal Exchange" at his own expense. The LSE is a joint stock company which trades its own shares as well.

Working hours: 07:30 p.m. - 03:30 p.m. in summer (Monday-Friday)
08:30 p.m. - 04:30 p.m. in winter (Monday-Friday)
Tokyo Stock Exchange accounts for 80 % of the country's stock turnover. The main traders are the institutional owners of security papers. In Japan the individual owners have only 20 % of the involved in the stock market shares, and 80 % belong to the financial organizations, insurance companies and corporations.

Tokyo Stock Exchange accounts for 80 % of country's stock turnover. The main traders are the institutional owners of security papers. In Japan individual owners have only 20 % involved in stock market shares, and 80 % belog to the financial organizations, ensurance companies and corporations.
Placement owners reckon not on the dividends (in early 1990 they were 70 times cheaper than the market stock price), but on the stocks' value rate increase and on profiting from selling stocks at a higher price (the average annual profit for selling the stock issued in 1980 - 1994 was 34.7 %). The main trading method is an open two-way auction. Up to 80 % of all traded stocks in the country are sold and purchased on Tokyo Stock Exchange. 1517 organizations out of 1.3 - 1.5 millions incorporated concerns in Japan are registered here, but they produce over 25 % of all commodities and services.
In 2005 Tokyo Stock Exchange took the second place in the world classification of the first-rate Stock Exchanges VSE. 2.5 thousand companies bringing a profit of more than 3000 billion US dollars were in the list of stock exchanges.

The Vienna Stock Exchange is one of the world's oldest stock exchanges and the only trading floor in Austria. This Stock Exchange is implementing trading in shares, obligations and derivatives. It was established in 1771 by the empress Maria Teressa for trading the government obligations. It is a private company.

Volume of trades - $ 48 468 billion,
Listing - 110 companies,
Capitalization - $ 157 358 billion,
Profit - EUR 8,12 million.
Work time: 07:00 - 15:30 during the summer (Monday - Friday) GMT,
08:00 - 16:30 during the winter (Monday - Friday) GMT.
The Frankfurt Stock Exchange FBW is the largest German and one of the world's biggest stock exchanges. The operator of this trading floor is Deutsche Boerse Group AG. The starting point of the existence of this stock exchange is considered to be in 1585 - the year of acceptance of unified exchange rates by merchants in Frankfurt am Main, which has become the largest European commercial center by that time. It has occupied the leading position in Germany since 1949. It was transferred to the control of "Deutsche Boerse Group" in 1993, created on its basis.
The main index - DAX, which reflects the share's prices of 30 major German companies and is a barometer of the German economy.
Work time: 07:00 - 15:30 during the summer (Monday - Friday) GMT
08:00 - 16:30 during the winter (Monday - Friday) GMT.
The Russian Trading System was established in the mid-1995 for the purpose of unification of regional markets into a single organized financial market in Russia. It falls under the group of the RTS.
The RTS is the generally recognized center of pricing of shares and obligations of a wide range of issuers. The information about trading on the RTS is the most important source of data about the situation of the Russian securities market, because it is this trading floor, which serves a significant part of foreign and Russian portfolio investments into shares of Russian companies.
Work time: 07:00 - 15:00 (Monday - Friday) GMT.

Exchange Markets Forex
FOREX - abbr. of FOReign Exchange. The term FOREX is usually used for mutual exchange of freely convertible currencies, but not for the totality of the FX transactions. According to the objectives Forex operations can be trading, speculative, hedging, and regulating (central banks’ interventions into exchange markets). In RuNet Forex means solely speculative currency trading via commercial banks or dealing centers held by means of leverage, i.e. margin trading.
Forex is the international interbank market. Operations are carried out through such institutions as: central banks, commercial banks, investment banks, brokers and dealing centers, retirement funds, insurance companies, transnational companies, etc. The volume of one contract with a delivery of real currency on the second working day (spot market) usually amounts to approximately 5 million US dollars or its equivalent. The value of one conversion payment is from 60 to 300 US dollars. Moreover, around 6000 US dollars per month are spent on the interbank informational trading terminal. Thus, the exchange of insignificant amounts is not conducted on Forex. For conversions of smaller amounts it is better to turn to a financial intermediary (a bank or an exchange broker), which executes the operations for a certain per cent of the transaction amount. Intermediaries do not need to operate on Forex market if they have a wide range of clients and differently directed orders. Though, they always get commissions from their clients. For the fact that not all the clients' orders go to Forex, the intermediaries can offer lower charges to their clients than the cost of direct operations on Forex. At the same time, if the intermediaries are eliminated, the exchange costs for the clients will increase.

The current quotations are used for a large number of operations, which do not always get directly to Forex. For example, the changing of the currency rate by the central bank, that has to save currency ratio among the international currencies in compliance with their proportions on Forex, even if the real supply/demand in a country does not correspond to the tendencies on Forex. For instance, if the supply of the euro is excessive on domestic market, while the euro/US dollar price is increasing on Forex, the central bank will have to increase the price, rather than reduce it being pressurized by the excessive supply.
Another vivid example is a marginal speculative currency trading, devoted to the fixation of Forex current quotations. Though, it does not imply the real delivery. Almost all intermediaries offer direct exchange services as well as speculative trading with the leverage on the currency market. Generally, commissions for such operations are much lower than those for a direct conversion, because the necessity in the real contracts for delivery concluding appears rather seldom due to large-scale involvement and fugacity of the deals. Often such commissions are in the form of a spread – a fixed difference between Bid and Ask price quoted at the same moment. Commonly, a chain of intermediaries exists between Forex and a speculator, where every intermediary takes its charge.
Marginal operations can lead (though not necessary do) to the real additional demand and supply formation on the currency market, especially within the short-term period. However, they cannot develop the general trend of the currency rates’ movement.
Work hours: 24-hours.


The Moscow Interbank currency Exchange is one of the largest universal exchanges in the Russian Federation, the countries of the CIS (the Commonwealth of Independent States) and East Europe. Established in 1992.
The MICEX is a leading Russian stock exchange where trading stocks and bonds of approximately 600 Russian issuers with the total capitalization of almost 24 billion rubles is conducted every day. The entry list of the MICEX consists of about 650 organizations which are professional market makers with the number of clients amounting to over 490 investors.

The MICEX holds 98% of the stocks’ and ADR of the Russian companies’ trades on assumption of the turnover on the Russian stock exchanges; and approximately 70 % based on the world trading volume of these securities.
During the period of 1992-1998 the foreign currency trading was carried out in the form of the auction on the MICEX, where unified fixed rates of the ruble versus the US dollar and of the Deutsche Mark against the US dollar for all participants of the trading session were set up. In 1997 the System of Electronic Lot Trading (SELT) was launched, it was functioning along with the main trading (the auction) till the crisis of 1998, thus becoming the major currency trading platform of the country thereafter. At present, trading via SELT joins eight interbank currency exchanges within the framework of a single trading session. Here the deals for the US dollar, the euro, the Ukrainian hryvnia, the Kazakhstan tenge, the Belarusian ruble and the operations with currency swaps are carried out. The total volume of stock operations with foreign currency in 2006 equaled to 25.9 billion rubles or 956 million US dollars (approximately half of the total stock turnover in the MICEX group). Currently, an effective system of risk management is established on the MICEX currency market, which guarantees timely discharge of obligations by all trading participants. Another element of the system is a "payment against payment" -principle, in accord to it the MICEX settles accounts with a trading participant only after it has discharged its obligations. 540 credit organizations are members of the MICEX market.

Work time: 07:00 - 15:00 (Monday - Friday) GMT

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