If you’re interested in the stock markets, then you must have heard about large stock exchanges such as the New York Stock Exchange (NYSE), the Nigerian Stock Exchange (NGX), and the Toronto Stock Exchange (TSE). Further, you would have heard of popular stock indices that track the performance of stocks listed on these exchanges such as the Dow Jones, the S&P 500, and the NGX All Shares Index.
Essentially, a stock exchange is an intermediary through which companies can be listed and their stocks can be traded by the public.
An index tracks the performance of the stocks listed on the exchange. For example, the S&P 500 tracks the performance of the 500 largest US companies that are listed on stock exchanges in the United States.
Why should you care about Global Stock Exchanges and Indices?
Rahul from Forex Brokers SA explains, “For traders & investors who looking to trade with a global portfolio, it is important to know about the most prominent stock exchanges and indices around the globe.”
Nigerian investors and traders can gain exposure to such indices by registering with global CFD brokers that are licensed with top-tier regulators to trade the global instruments.
Traders can trade on global stock markets and shares of top companies and they can even trade Indices which track whole sector or top companies through these global brokers.
Trading on Indices is quite popular among investors as a method of diversification as it balances portfolio among various companies or sectors.
For example, NASDAQ 100 is one of the most popular index among global & African investors for investing in tech stocks and it can be traded through CFD brokers that offer NASDAQ or NAS100. Similarly, S&P 500, CAC40, DAX, FTSE 100 can be traded through CFD brokers to gain exposure of leading stocks in global markets or to speculate.
But traders & investors must note that with CFD trading, you don’t actually own the stocks, you are only speculating on its rise or fall.
In this article, we’ll be discussing the largest stock exchanges in the world. We’ll also briefly a few of the major stock indices.
These are the leading stock exchanges in the world in terms of the trading volume. We will be briefly discussing each of them.
- New York Stock Exchange (NYSE), United States of America
The NYSE has been in operation since 1792 and is one of the world’s oldest stock exchanges. It is the world’s largest stock exchange in terms of market capitalization by a significant margin.
It currently has a market capitalization of around $30.1 trillion. The average daily trading volume of the exchange is around $170 billion.
The NYSE is owned and run by the Intercontinental Exchange company. The exchange has listings of over 2,200 companies.
Some of the most notable public companies that are listed on the NYSE include JP Morgan & Chase, Alibaba, Walmart, Proctor and Gamble, and so on.
The popular stock indices that track the performance of companies listed on the NYSE include the Dow Jones Industrial Average and the S&P 500.
2. NASDAQ (NASDAQ), United States of America
The NASDAQ was founded in 1971, and is the second-largest stock exchange operating in the United States of America. It is owned by Nasdaq, Inc.
The NASDAQ has a market capitalization of around $25.6 trillion as of September 2021. It has a daily trading volume of approximately $5 billion.
The NASDAQ stock exchange holds upwards of 3,500 listings. Some of the most prominent companies listed on the exchange include Microsoft, Apple, and Amazon. The NASDAQ stock exchange is known for being heavy in terms of technology stocks.
The most popular indices that track stocks listed on the NASDAQ include NASDAQ-100 and the NASDAQ Composite.
3. Shanghai Stock Exchange (SSE), People’s Republic of China
The Shanghai Stock Exchange has been operating since 1990, and it is one of just two stock exchanges operating independently in mainland China. The other stock exchange is the Shenzen Stock Exchange.
Originally, Shanghai had an exchange since 1891. However, the Shanghai Stock Exchange in its current form has only been operating since 1990. It is operated by a non-profit that is directly controlled by the China Securities Regulatory Commission (CSRC).
The SSE has a total market capitalization of $7.7 trillion as of October 2021. It has an average daily trading volume of upwards of $500 billion. The exchange lists more than 2000 companies.
The most prominent indices that track SEE-listed companies include SSE Composite and the SSE 50. Some of the largest companies listed on the SSE are PetroChina, Bank of China, and China Life.
4. Tokyo Stock Exchange (TSE), Japan
The Tokyo Stock Exchange was started in 1878. It has a total market capitalization of around $6.7 trillion as of September 2021.
It is owned by Japan Exchange Group, which is a holding company. The TSE lists around 2,200 companies. The base currency of the exchange is Japanese Yen. Top indices that track the performance of stocks listed on the exchange include the Nikkei 225 and Topix.
Some of the most prominent companies listed on the exchange include Toyota Motor, Sony, and Recruit Holdings.
5. Euronext, Netherlands
Euronext N.V. is a European stock exchange that was founded in 1602 in the Netherlands. The present consortium was founded in 2000. The headquarters of the exchange are located in Paris, France, and Amsterdam, Netherlands.
As of 2021, the exchange had more than 1900 companies listed. The total market capitalization of the index is over 5.6 trillion Euros. The average trading volume on the exchange is upwards of 9.7 billion Euros.
Some of the most prominent companies listed on the exchange are Loreal, Ely Lilly, Royal Dutch Shell, and more. The most popular index that tracks of the performance of the Euronext is the Euronext 100.
6. London Stock Exchange (LSE), United Kingdom
The London Stock Exchange was originally founded in 1801. It is also one of the oldest stock exchanges in the world. It is located in the City of London, England. The total market capitalization of companies listed on the exchange is upwards of 4.5 trillion British pounds.
The LSE is part of the London Stock Exchange Group. The London Stock Exchange Group was formed by the merger of the London Stock Exchange with the Milan Stock Exchange.
Some of the most prominent companies listed on the exchange include Boeing, Unilever, AstraZeneca, and more. Popular indices associated with the exchange include FTSE 100, FTSE 250, FTSE 350, etc.
7. Hong Kong Stock Exchange (HKSE)
The Hong Kong Stock Exchange is based in Hong Kong and was founded in 1891. The HKSE is owned and operated by the Hong Kong Exchanges and Clearing Limited. The physical trading floor of the exchange has been closed since 2017.
The HKSE currently lists more than 2,500 companies. The exchange has a total market capitalization of HK$ 47 trillion. It has an average daily trading volume of HKD 90 billion.
The largest companies which are listed on the exchange include Tencent Holdings, China Construction Bank, HSBC Holdings, and more. The most popular exchange index associated with the HKSE is the Hang Seng Index.
8. Shenzhen Stock Exchange (SSE), People’s Republic of China
The Shenzhen Stock Exchange is a Chinese stock exchange which is based in the city of Shenzhen. As mentioned earlier, it is one of two stock exchanges that operate in mainland China. The total market capitalization of the exchange is upwards of US$ 5.8 trillion.
Some of the most prominent companies listed on the exchange are Midea Group, Ping An Bank, Byd Company, and more.
The performance of the SSE is tracked by the SZSE 100 (for blue-chip stocks), SZSE 200, and the SZSE 300, along with others.
9. National Stock Exchange (NSE), India
The National Stock Exchange is an Indian stock exchange that was founded in 1992. It is located in Dalal Street, Mumbai (formerly known as Bombay). It is the oldest stock exchange in Asia, and is the tenth largest stock exchange worldwide.
The NSE has a total market capitalization of US$3.4 trillion as of 2021. NSE is tracked by indices such as the Nifty50.
10. Toronto Stock Exchange (TSE), Canada
The Toronto Stock Exchange is the largest stock exchange operating in Canada. It was founded in 1861. It is the third-largest stock exchange by market cap in North America.
The TSE is a wholly-owned subsidiary of the TMX Group. Apart from conventional securities, the TSE also lists exchange-traded funds, income trusts, and investment funds.
The total market capitalization of the exchange is more than $3.1 trillion. It has an average daily trading volume of 3.9 billion shares.
Some of the largest companies listed on the TSE are Shopify, Nova-Scotia Bank, Enbridge, and Brookfield. The TSE is tracked by prominent indices such as S&P/TSX 60, and S&P/TSX Composite.
11. Johannesburg Stock Exchange (JSE), South Africa
The JSE is the largest stock exchange in Africa. It has a total market cap of $1.2 Trillion.
Some of the largest companies listed on the JSE are Prosus (formerly Naspers), AB InBev, British American Tobacco. The JSE is tracked by JSE All Shares Index.
- S&P 500
The S&P 500 is one of the most prominent indices in the United States and it measures the value of the top 500 companies listed on the NYSE and the NASDAQ.
2. Dow Jones Industrial Average
The Dow Jones is a price-weighted index that tracks the value of the 30 most prominent companies listed on the NYSE or the NASDAQ.
3. NASDAQ Composite Index
The NASDAQ Composite Index was created to track the value of almost all the companies that are listed on the NASDAQ stock exchange. It is the third most-followed index in the United States.
4. FTSE 100
The FTSE 100, also called the “Footsie”, is an index comprising the 100 largest companies that are listed on the London Stock Exchange.
5. Nikkei 225
The Nikkei 225 is a price-weighted index. It seeks to measure the value of 225 large companies that are listed on the Tokyo Stock Exchange from a variety of industries and sectors.
6. CAC 40
The CAC 40 is a French index that tracks the value of 40 of the most significant stocks amongst the top 100 largest stocks listed on the Euronext exchange.
The DAX is a German index that measures the value of the 40 largest companies that are listed on the Frankfurt Stock Exchange.
In the end, it is important to keep tab on global markets for Nigerian investors.
It is important to gain understanding of global markets & how they affect the equities listed in Nigeria, because the volatility in major global stocks could also affect your investment portfolio composed on Nigerian equities.