There are approximately 28 countries in the world that do not have a stock exchange. On the other hand, a stock exchange is present in approximately 158 countries. Furthermore, some countries have multiple stock exchanges, while others share a stock exchange.
According to most estimates, approximately 630,000 companies are now publicly traded around the world. The expansion of global stock markets outside of the United States and Europe is a major reason why the number of publicly traded companies continues to rise. The United States continues to have the largest exchange in the world, but many of the largest exchanges now reside in Asia, which is growing in influence on the global stage.
The following is a list of some of the world’s largest exchanges.
The Shanghai Stock Exchange
The Shanghai Stock Exchange is one of the world’s newest. It debuted in late 1990 and currently trades with 1,500 companies. Trading volume is increasing, but it had dropped dramatically since 2008, when investment interest in China peaked.
One significant limitation is that “A” shares in Chinese companies are only available to Chinese citizens. On the other hand, global investors can buy “H” shares in Hong Kong.
The Hong Kong Stock Exchange
The Hong Kong Stock Exchange is one of the world’s top ten most important stock exchanges. The total market capitalization of the companies listed on the Hong Kong Stock Exchange is close to $2 trillion. The exchange began operations just before 1900 and has approximately 1,500 companies. Most importantly, the exchange is one of the primary channels through which global investors can invest in China.
The London Stock Exchange
With an estimated $2.2 trillion in stock market capitalization from the companies listed on its exchange, the London Stock Exchange (LSE) qualifies as a top-five stock market. It is thought to have been founded in 1801, nearly a decade after the NYSE opened.
Because approximately 3,000 companies worldwide trade on the LSE and its affiliated exchanges, the LSE considers itself to be the most international of global exchanges.
The Tokyo Stock Exchange
The Tokyo Stock Exchange (TSE) is Japan’s largest exchange. It ranks second only to the New York Stock Exchange (NYSE) in terms of the more than $3 trillion in market capitalization represented by the companies listed on its exchange. A stronger national currency is one of the factors driving the TSE’s expansion. The TSE is home to approximately 2,000 companies.
The exchange is thought to have opened in 1878 and collaborates with other exchanges worldwide, including the London Stock Exchange (see below). The Nikkei 225 index is one of the most important and widely followed indexes, representing some of Japan’s largest and most successful companies.
The New York Stock Exchange
The New York Stock Exchange (NYSE) is a subsidiary of NYSE EURONEXT, which now operates exchanges in the United States and Europe. It estimates that its exchanges account for one-third of all equities traded globally. The NYSE remains one of the world’s primary exchanges and the largest in terms of stock market capitalization (nearly $10 trillion).
The NYSE has been in operation since 1792, and it is believed that the first stock traded was that of the Bank of New York, which is now part of the Bank of New York Mellon. As a result, the NYSE bell ringing at the start and end of the day is common in today’s media.
In recent years, the industry has become extremely competitive. For example, the company notes in a recent filing with the Securities and Exchange Commission (SEC) that it must compete for the listings of cash equities, exchange traded funds, structured products, futures, options, and other derivatives.
How do I invest money in the stock market?
Step 1: Learn the fundamentals of finance and accounting. Check that you understand how to read a balance sheet and a profit and loss statement. In addition, ensure you understand key financial ratios such as PE, PB, etc.
The desired outcome – you should be able to identify a company’s financial health by looking at its financial statements.
For example, you should be aware of the company’s year on year and quarter on quarter revenue growth, year on year and quarter on quarter profit growth, as well as some important financial ratios such as the PE and PB ratios.
Time required: approximately 15-20 hours.
Step 2: You must now select an industry in which you know or are interested. Read the most recent news about industry developments.
Desired Outcome – You should be able to comprehend the macro environment, which is beyond the company’s control but has an impact on it directly or indirectly. For instance, government policies, crude oil prices, and so on.
For example, if you choose banking, you should understand bad debt and the impact of recent RBI policies on the banking sector.
Time required: approximately 15-20 hours. To keep yourself updated, this will be a continuous process.
Step 3: List the companies in your industry of knowledge or interest.
3.a) Select the industry’s top companies/market leaders.
In the banking industry, for example, HSBC.
Time required – 5 hours are required.
3.b) Take a look around and identify the products/services that you enjoy. For example, in the last ten years, many people have begun to wear Jockey. It’s a hit with everyone. Consider the company that sells Jockey. In 2008, the share price of Page Industries was around 450. In 2018, it was estimated to be around 30000. That is approximately 70 times the return in the last ten years. Can you think of another company that has a bright future? Consider it…
Step 4: Open a ZERO brokerage trading account. Why pay a brokerage fee on every transaction when you can invest your money for free?
Time required: A few days from the verification of documents to the opening of an account.
Step 5: Begin slowly. Don’t put a lot of money into it all at once. Continue to monitor the stock and industry, and continue to learn. Examine how the stock behaves when the market is good, but the true test is when the market is bad. Nobody is capable of making perfect decisions. Investment in the stock market is not a fixed formula but a combination of experience and knowledge.
The Nasdaq, which is also based in the United States, the Bombay Stock Exchange in India, the Sao Paulo Stock Exchange in Brazil, and the Australian Stock Exchange are also worth mentioning. These exchanges continue to have an increasing impact on the global stage.
The current global recession has slowed the progress of emerging markets. Still, they are expected to gain market share in the coming decades as their economies grow, new firms go public and raise capital to serve a growing class of consumers. In addition, the global network of exchanges continues to expand.
