Introduction
If you are new to Stock Exchange trading you have to first understand what it is and how it works. Stock exchange provides a platform where stocks, securities and bonds are exchanged by traders and stock brokers. These Exchanges also provide services for the issue as well as redemption of financial instruments like securities. Some financial events like the pay outs of dividends and income are done through a stock exchange. Now if you would like to know what is meant by security? Securities that are exchanged or traded on an exchange are unit trusts, bonds; shares issued by a company, derivatives and pooled investment products. A security must be listed on a stock exchange to be able to be traded there. Earlier the activity of trading was centralized but now with the advent of technology it is mainly conducted through electronic systems and network. London Stock Exchange is no exception and despite being one of the oldest stock exchanges in the world, it is quite technologically advanced.
History
London Stock Exchange started its operation in the year 1801 and from Sweeting’s Alley in the city of London. In the next year, however, it was moved to the Capel Court. Since then there had been milestones in the history of London Stock Exchange. The Exchange was shifted to a newly built building in Thread needle Street in 1972. From the year 1986 the Exchange was deregulated and ownership by member companies became a norm for the very first time in 1986. The year 1995 saw the launch of the concept called Alternative Investment market. In 2004 there was another change in location of the Exchange as it moved to Paternoster Square. London Stock Exchange acquired Borsa Italian, the Milan based exchange to form London Stock Exchange Group Plc. in 2007 for an amount of $ 2 billion. This was an all share deal and it diluted the London Stock Exchange shareholders stake and Borsa’s shareholder’s received shares worth 28% of the total register. In 2009, London Stock Exchange acquired the Sri Lankan software major Millennium Information Technologies Ltd. for $30 million. Millennium specializes in creating trading software and systems. The year 2011, however, saw a failed attempt by the London Stock Exchange to acquire TMX Group.
Working
With the acquisition of Borsa, the London Stock Exchange Group Plc. became a leading equities exchange hub. It has the highest volume traded and liquidity order book in terms of value. It has 48% of FTSE Euro First100.
Primary Shareholders
The main shareholders of London Stock Exchange are the Borsa Dubai with the total share of 20.6%. Next come Qatar Investment Authority with the shareholding of 15.1%. After that there is Unaccredited with the total holding of 6.0 %. Intesa Sanpaolo holds a share of 5.3%. While FIL limited holds a share of 5.0%. There is a shareholding of 5.0% by the Legal and General holding. Before investing you must go through the brochures and the documents narrating the offers in details to gain maximum knowledge and invest your hard earned money in a safe way.
