Financial world rings
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
Stock market is an abstract
concept, served for definition of cumulative actions and mechanisms,
which make securities trading possible. You should not mix this concept
with stock exchange, which is organization with the following aims:
providing a place for execution of trading deals and arranging together
buyers and sellers of securities.
New York Stock Exchange - the main stock exchange in USA, the largest in the world. The symbol of financial power of USA and financial industry in the whole. In New-York trading world-wide known Dow-Jones index is defined for shares of industrial companies as well as index NYSE Composite.
NYSE Composite - one of the
most popular stock indexes in the world. It reflects rate changes of
all shares, quoted at New-York stock exchange, including more than 1500
American largest companies with total capitalization more than 20 USD
billions. That is why NYSE Composite can serve as indicator of USA economy.
The stock was founded on 17 May 1792. Since 1975 becomes non-commercial corporation, owned by 1336 members (this figure is unchanging since 1953). Places of members can be sold, the price for one place is reached 3 millions dollars.
In the beginning of May 2006 NYSE finishes merger with electronic stock Archipelago Holdings and for the first time offer shares to investors, became in this way commercial organization.
Share trading of NYSE Group
is holding on stock; capitalization for beginning of March was 12,5
billion of USD. At stock it is holding operations with shares and securities
of more than thousands items. Total companies' capitalization trading
at NYSE was 26,5 USD trillions by the end 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 on shares of high-technology companies (electronics, software production and etc.). One of the three main USA stocks (together with NYSE and AMEX) are units of NASD, controlled by SEC. The owner of stock - American company NASDAQ OMX Group. Except NASDAQ, is owns more 8 European stocks.
At the given moment more than 3200 companies including Russian companies are trading at NASDAQ.
Regular NASDAQ trading session
begins at 9:30 a.m. and ends at 4:00 p.m. (USA East coast time). Trading
operations are hold on the basis of platforms SuperMontage and Primex.
After regular session ends it is possible to held trading before 8:00
p.m. via platform SelectNet. Scheme according to which trading is hold
at stock NASDAQ is different from traditional. Several market-makers
compete for execution of clients' orders. At the given moment there
are about 600 market-makers. The main function of market-maker
at NASDAQ (as well as at NYSE) - uninterrupted quotations providing
and sustain liquidity of certain shares group during trading. Market-maker
must execute an order at his own expanse in case there is no appropriate
opposite order at the market. Some market-makers support hundreds of
shares, others - thousands. As a result, on average one type of shares
are supported by 14 market-makers, other shares types - up to 50.
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
New-York Merchantile Exchange
(NYSE: NMX) founded at 1872, take first place in the world on oil futures
trading. Contracts for oil, gas, platinum, palladium, gold, silver,
copper and aluminum are traded at this Exchange. According to the data
of Futures Industry Association in the year 2006 216 billions of deals
were executed. In 2006 NYMEX profit was 497,3 billion of USD, net profit
154,8 billion of USD. Capitalization - 11,4 billion of USD.
London Stock Exchange - one
of the biggest and oldest European Exchange. Officially founded in 1801,
however in fact its histori began in 1570, when King's financial agent
and adviser Thomas Gresham built "Royal Exchange" on his own money.
LSE is a joint stock company, its own shares is traded at LSE.
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 was founded
in 1878. Tokyo Stock Exchange is unprofitable member organization. It
is body corporate and has multiple rights in sphere of self-government.
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 do not figure on the dividends (in the beginning of 1990 they were 70 times cheaper of the market stock prize), but on the stocks' rate increasing and getting profit from selling the stocks for a higher prize (average annual profit for sold stock issued 1980 - 1994 is 34.7 %). The main trading method is open double auction. Up to 80 % of all the involved stocks in the country is selling and buying on Tokyo Stock Exchange. 1517 organizations of 1.3 - 1.5 millions incorporated concerns in Japan are registered, but they make more than 25 % of all produced goods and services.
In 2005 Tokyo Stock Exchange
took the second place in world classification of the first-rate Stock
Exchange all over the world. 2,5 thousands of the companies, which bring
more than 3000 billion of US dollars profit.
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 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 been occupying 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.
FOREX - abbr. of FOReign
Exchange. Term FOREX is usually used for mutual designation of freely
convertible currencies but not for the totality of the FX transaction.
Operations on Forex by objectives market can be trading, spekulative,
hedging, regulating (excange market intervention). In RuNet Forex means
solely spekulative currency trading using commercial banks and dealing
centers, using leverage, i.e. margin trading.
Forex is international inrebank
market . Operations are carryed out via system of institutions: central
banks, commercial banks, investment banks, brokers and dealing centers,
retirement fund, ensurance companies, transnational companies, etc.
Volume of one contract with real currency delivery at the second working
day (spot market) is usually cost approximately 5 millions US dollars
or its equivalent. Value of one conversion payment is from 60 till 300
US dollars. Moreover it has to spend more than 6 thousands of US dollars
per month for interbank informational trading terminal. Because of such
conditions convertion of small amounts. For convertion of small amounts
it is better to turn to financial intermediary( bank or exchange broker),
which convert for certain per cent of the amount of deal. Intermediary
not always have to convert via Forex market if they have many clients
and differently directed orders. But they always get commissions from
their clients. For the fact that not all the clients' orders get to
the Forex, intermediaries can offer lower commisions to their clients
that value of direct operations on Forex. At the same time if intermediaries
will be eliminated, conversion cost for the client will increase.
Current quatations are used
for most per cent of operations, which not obligatory get to the Forex
directly. For example changing currency rate by the state bank, which
has to save currency proportions between international currencies in
compliance with their proportions on Forex even if the real supply/demand
in a country is not correspond with tendencies on Forex. For instance,
if supply of euro is redundant on domestic market, but the price of
euro/US dollar is increasing on Forex, and then central bank will has
to increase the prize but not lower the prize under pressure of redundant
Another striking example is marginal speculative currency trading oriented to fixation current quotations of Forex, but carrying out without real delivery. Almost all the intermediaries on currency market offer direct conversion services and speculative trading with the leverage. Generally, commissions from such operations are much lower than for direct conversion, because necessity of real contracts concluding for delivery appears seldom because of large-scale involvement and fugacity of the deals. Often such commissions assume a shape of spread - fixed difference between Bid and Ask prize at the present moment. Commonly the file of intermediaries forms between Forex and speculator and each intermediary takes its commission.
Marginal operations can lead
but not necessary lead to the real demand and supply on currency market
especially during the short-term period. However they cannot form common
tendency of currency rates moving.
Work hours: 24-hours.
Moscow Interbank currency Exchange
is one of the large-scale universal exchange in Russia, countries of
CIS (Commonwealth of Independent States) and East Europe. Established
Stock exchange MICEX is leading
Russian stock exchange where trading session for stocks and bonds of
approximately 600 Russian issuers with total capitalization of almost
24 billion rubles is carrying out every day. Entry list of stock exchange
trading on MICEX consist of 650 organizations which are professional
market makers, whose clients are more than 490 investors.
98% of rotation of stocks trading
and ADR of Russian companies on assumption of rotation on Russian exchange
and approximately 70 % on assumption of world trading volume of these
stock securities fall on the MICEX.
During the period from 1992
till 1998 trading of the foreign currencies on MICEX were carrying out
in regime of auction. During the auction single fixed rates of ruble
to US dollar and D-mark for all the traders were set up. In 1997 System
of Electronic Lot Trading (SELT) was created, it was functioning simultaneously
with the main trading (auction) till the crisis of 1998, and then it
became the main currency trading ring of the country. At present trading
through SELT are combined in the network of the single trading session
by eight interbank monetary stocks. Daily trading on US Dollar, Euro,
Ukraine's gryvnia, Kazakhstan Tenge, Belarussian rouble and
operations with currency swap is carrying out on exchange. Total volume
of the stock dealings with foreign currency is 25.9 billion of rubles
and 956 million of US Dollars in 2006 (approximately the half of total
stock turnover of MICEX group). At present system of risks management
is created on MICEX which allows to guarantee timely discharge of obligations
by all traders. One of the elements of this system is "payment against
payment" principle, in compliance with it MICEX pays with trading
participant only after him discharging of obligations. Members of units
of currency market MICEX are 540 credit organizations.
Work time: 07:00 - 15:00 (Monday - Friday) GMT
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