LSE

LSE - London Stock Exchange (LSE)

About the London Stock Exchange :

The London Stock Exchange is the most important exchange in Europe and one of the largest in the world. It lists over 3,000 companies and with 350 of the companies coming from 50 different countries, the LSE is the most international of all exchanges.
The London Stock Exchange is comprised of two different stock markets: the Main Market and the Alternative Investment Market (AIM). The Main Market is solely for established companies with high performance, and the listing requirements are strict. Approximately 1,800 of the LSE's company listings trade on the Main Market, and the total market capitalization is over 3,500 billion. The Alternative Investment Market on the other hand trades small-caps, or new enterprises with high growth potential. Over 1,060 companies list on this market, with a total capitalization of 37 billion.

The LSE is completely electronic, but different shares are traded on different systems. Highly liquid shares are traded using the SETS automated system on an order driven basis. This means that when a buy and sell price match, an order is automatically executed. For securities that trade less regularly, the London Stock Exchange implements the SEAQ system, where market makers keep the shares liquid. These market makers are required to hold shares of a specific company and set the bid and ask prices, ensuring that there is always a market for the stock.

The LSE also has a new and growing exchange for equity derivatives called EDX London, created in 2003. In 2004, EDX traded an average of 382,599 contracts per day. Its aim is to become the leading derivatives market in the world.

LSE - History of the London Stock Exchange :

Tracing its history to the late 1600's, the London Stock Exchange is one of the oldest in the world. It began in 1698, when a man named John Castaing began publishing lists of stock prices called 'The Course of the Exchange and Other Things'. London's stock dealers were at this time making trades in the streets and in coffee houses. In 1761, 150 of these stockbrokers started a club for buying and selling shares in a dealing room on Sweeting's Alley, which eventually became known as The Stock Exchange. It became an official, regulated exchange in 1801 and a year later moved into a building in Chapel Court.
Like many other stock exchanges, the London Stock Exchange closed for five months during World War I, and again for six days during World War II. Then in 1972 a new office with a 23,000 square foot trading floor was opened for the exchange by Queen Elizabeth II on Threadneedle Street. A year later, all the regional exchanges in England and Ireland merged with the London Stock Exchange.

In 1986 there was a deregulation of the exchange, called the 'Big Bang'. Among other things, this deregulation allowed outside corporations to own member firms, eliminated voting rights for individual members, and transformed the face-to-face trading system into one largely operated over computers and telephones.

In 1995, the London Stock Exchange opened the Alternative Investment Market, creating the division between the trading of large cap and small cap companies. In 2000, the London Stock Exchange made the decision to go public, and began listing their shares on their own exchange in 2001. In 2004, the exchange left their building on Threadneedle Street to move to their current location on Paternoster Square near St. Paul's Cathedral.