2nd Episode : Stock Mkt.

Stock exchange is an organized market for buying and selling corporate and other securities. Here, securities are purchased and sold out as per certain well-defined rules and regulations. It provides a convenient and secured mechanism or platform for transactions in different securities. Such securities include shares and debentures issued by public companies which are duly listed at the stock exchange, and bonds and debentures issued by government, public corporations and municipal and port trust bodies. All the transactions of any kinda investments are done under this exchange with an organized manner. Every country has its own Stock Exchange.

We have BSE and NSE in India:
BSE : Bombay Stock Exchange             NSE : National Stock Exchange

Ten largest stock exchanges in the world :

1. New York Stock Exchange (NYSE) - Headquartered in New York City. Market Capitalization (2011, USD Billions) – 14,242; Trade Value (2011, USD Billions) – 20,161.

It is The largest stock exchange in the world by both market capitalisation and trade value. NYSE is the premier listing venue for the world’s leading large- and medium-sized companies. NYSE offers a broad and growing array of financial products and services in cash equities, futures, options, exchange-traded products (ETPs), bonds, market data, and commercial technology solutions. Featuring more than 8000 listed issues.

2. NASDAQ OMX - Headquartered in New York City. Market Capitalization (2011, USD Billions) - 4,687; Trade Value (2011, USD Billions) – 13,552.

Second largest stock exchange in the world by market capitalization and trade value.  It is a home to approximately 3,400 listed companies and its main index is the NASDAQ Composite, which has been published since its inception. Stock market is also followed by S&P 500 index.

3. Tokyo Stock Exchange - Headquartered in Tokyo. Market Capitalization (2011, USD Billions) – 3,325; Trade Value (2011, USD Billions) – 3,972.

Third largest stock exchange market in the world by aggregate market capitalization of its listed companies. It had 2,292 companies which are separated into the First Section for large companies, the Second Section for mid-sized companies, and the Mothers section for high growth startup companies. 

4. London Stock Exchange - Headquartered in London. Market Capitalization (2011, USD Billions) – 3,266; Trade Value (2011, USD Billions) – 2,871.

Located in London City, it is the oldest and fourth-largest stock exchange in the world. It is the most international of all the world’s stock exchanges, with around 3,000 companies from over 70 countries admitted to trading on its markets. The London Stock Exchange runs several markets for listing, giving an opportunity for different sized companies to list. 

5. Shanghai Stock Exchange - Headquartered in Shanghai. Market Capitalization (2011, USD Billions) – 2,357; Trade Value (2011, USD Billions) – 3,658.

It is the world’s 5th largest stock market by market capitalization and one of the two stock exchanges operating independently in the People’s Republic of China. Unlike the Hong Kong Stock Exchange, the SSE is not entirely open to foreign investors. The main reason is tight capital account controls by Chinese authorities. The securities listed at the SSE include the three main categories of stocks, bonds, and funds. Bonds traded on SSE include treasury bonds, corporate bonds, and convertible corporate bonds. The largest company in SSE is PetroChina (market value – 3,656.20 billion).

6. Hong Kong Stock Exchange - Headquartered in Hong Kong. Market Capitalization (2011, USD Billions) – 2,258; Trade Value (2011, USD Billions) – 1,447.

It is the third largest stock exchange in Asia and the sixth largest in the world in terms of market capitalization. Hong Kong Stock Exchange (SEHK) has about 1,477 listed companies and it operates securities market and a derivatives market in Hong Kong and the clearing houses for those markets. The three largest stocks by market capitalisation in Hong Kong Stock Exchange are PetroChina, Industrial & Commercial Bank of China, and China Mobile.

7. Toronto Stock Exchange - Headquartered in Toronto. Market Capitalization (2011, USD Billions) – 1,912; Trade Value (2011, USD Billions) – 1,542.

It is the largest stock exchange in Canada and the third largest in North America. Toronto Stock Exchange is owned by and operated as a subsidiary of the TMX Group for the trading of senior equities. Toronto Stock Exchange is the leader in the mining and oil & gas sector, including such companies like Cameco Corporation, Canadian Natural Resources Ltd., EnCana Corporation, Husky Energy Inc., Imperial Oil Ltd., and others.

8. BM&F Bovespa - Headquartered in Sao Paulo. Market Capitalization (2011, USD Billions) – 1,229; Trade Value (2011, USD Billions) – 931.

Founded in 1890, today BM&F Bovespa is the largest stock exchange in South America and 8th largest in the world . There are about 381 listed companies at Bovespa.

9. Australian Securities Exchange - Headquartered in Sydney. Market Capitalization (2011, USD Billions) – 1,198; Trade Value (2011, USD Billions) – 1,197.

The Australian Securities Exchange is Australia’s primary securities exchange and it was created back in 2006 when the merger of Australian Stock Exchange and the Sydney Futures Exchange took place. Today Australian Securities Exchange is 9th largest stock exchange in the world by market capitalization and has an average daily turnover of 4,685 billion dollar. 

10. Deutsche Börse - Headquartered in Frankfurt. Market Capitalization (2011, USD Billions) – 1,185; Trade Value (2011, USD Billions) – 1,758.

Deutsche Börse is one of the world’s leading exchange organizsations providing investors, financial institutions and companies access to global capital mkt. Deutsche Börse has an approximately 765 listed companies with a combined market capitalization of 1,185 trillion USD.

Most of the stock mkts across the world fluctuate and move depending upon the movement of the above listed world's major stock exchanges. 

The first questions any share investor asks are, 'Is the market up or down?' and 'How are my shares doing?'. The answers to these and many other questions about the market depend on having a good 'share market index'. It measures the market and tells you if it's up, down, ahead or behind. But what is an index?
We wl talk about it in the next episode...