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The Tokyo Stock Exchange

The third largest stock exchange of the world is situated at 2-1 Nihobashi-Kabutocho, Chuo and Tokyo. Established in 1878, in short it is called the Tosho or the TSE. The Tokyo Stock Exchange operates from 9AM to 11AM and again from 12:30 to 3PM.

The Tokyo Stock Exchange went electronic for trading of all transactions in 1999. Until 2001, the TSE was working as an incorporated association, with its members as its shareholders. In 2001, it was restructured as a stock company.

In Japan, the Tokyo Stock Exchange is the largest market. JASDAQ, the Japanese version of NASDAQ in US, is also part of this market. The TSE carries out nearly 90 percent of the trades in Japan. TSE stocks can be traded using CORES or FORES. FORES is the Floor Order Routing and Execution System. It deals with 150 of the most-traded stocks. The rest are handled by CORES or Computer Assisted Routing and Execution System.

The Measuring Index

For tracking the Tokyo Stock Exchange, the main indexes are the Nikkei 225 and the TOPIX. Japan's largest newspaper, Nihon Keizai Shimbun, selects some companies, whose index is calculated as the Nikkei. This is a price-weighted average. For Asian stocks, Nikkei is the most-watched index. The First Section listed companies and the J30 index of large industrial companies are measured as TOPIX. According to the Tokyo Stock Exchange, the most appropriate benchmark is the TOPIX for evaluating portfolio management.

In 2005, the newly-installed transaction systems at the Tokyo Stock Exchange malfunctioned, causing the TSE to operate for only 90 minutes in the month of November. The same year, a month later, a simple typing error caused a net loss of nearly 7 million US dollars. Another incident, again after a month, caused the stock exchange to close early, because they had exceeded their daily quota of 4.5 million trades per day.

The New York Stock Exchange

Located at 11 Wall Street, in lower Manhattan, New York City stands the world's largest stock exchange. This is the New York Stock Exchange, also called the NYSE.

In 2007, the NYSE integrated with the Euronext, the fully electronic stock exchange. It is the NYSE Euronext that runs the New York Stock Exchange today. The trading area of the NYSE is comprised of four rooms, located at 11 Wall Street. In 1978, the 11 Wall Street building was declared a National Historic Landmark.

On the trading floor of the New York Stock exchange, buyers and sellers trade shares of stock in companies which are registered for public trading. The trading hours of the NYSE are between 9:30AM and 4:00PM ET, Monday through Friday. Holidays are declared in advance by the exchange.

Traders execute stock exchanges on the trading floor of the New York Stock Exchange in a continuous auction format. A specialist broker usually acts as an auctioneer. He is not employed by the New York Stock Exchange, but is an employee of an NYSE member firm. He manages the actual auction to bring the buyers and sellers together in an open outcry auction market environment.

Modernization Of The NYSE

In 1995, an automation drive was started in the NYSE. The 203-year-old traditional method of transacting through paper ended. The automated trading empowered traders to receive and carry out orders electronically. Wireless transmissions now disseminate information to traders via hand-held computers.

Since January 2007, customers are able to send their orders for trade electronically via the NYSE electronic Hybrid Market. They can send their orders for immediate execution or for trade in the auction market. The popularity of the electronic method can be gauged from the fact that in the first three months of 2007, order volumes delivered electronically exceeded 87 percent of the total orders.

The London Stock Exchange

The fourth-largest stock exchange in the world is located in the city of London, in the United Kingdom. This stock exchange is the London Stock Exchange, and it is part of the London Stock Exchange Group. Founded in 1801, its current location is the Paternoster Square, near St. Paul's Cathedral.

London began trading in shares around 1688. This was when the East India Company wanted to reach India and the Far East, but was unable to finance the voyage privately. The company raised capital by selling shares to merchants. The merchants got rights to a portion of the profits made by the East India Company.

Setbacks And Merger Attempts

One of the earliest setbacks for the London Stock Exchange was caused by the South Sea Company. The company's owners and the British government had set up the unprofitable company, and it was running up huge debts. In 1720, they wanted to wipe out the debts by offering shares to the public.

The shares picked up in momentum, and soon began selling at high prices. The bubble did not last, and finally, the share prices plummeted. The public outcry that followed forced the government to formulate legislation to prevent further misuse. Recovery for the London Stock Exchange took a long time.

Since 2005, several attempts have been made to acquire the ownership of London Stock Exchange through buying up its shares. The first attempt was a takeover bid by the Macquarie Bank. This was thwarted by shareholders. The second attempt was by NASDAQ, which tried for a year or more before finally giving up its unsuccessful attempt.

In 2011, the London Stock Exchange Group announced their intentions of merging with the owners of the Toronto Stock Exchange. The Toronto Stock Exchange is run by the Toronto based TMX Group. The arrangement is such that the new, enlarged group will have the TMX Chief as the firm's president. The new company will be headed by the current CEO of the LSE group.