There are nearly as many stock exchanges around the world as there are countries, but 87% of the world’s market capitalization is concentrated in just 16 such exchanges.
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A stock exchange is basically a market for stocks. It’s a place where buyers can connect with sellers to trade shares of public companies.
There are 60 major exchanges in the world, but 16 of them make up what’s known as the Trillion Dollar Club, because they have at least one trillion dollars in market cap.
Here’s a look at the top 10:
- New York Stock Exchange – NYSE
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The NYSE is far and away the largest stock exchange on the planet. Weighing in at over $19 trillion, this giant is nearly three times the size of its closest competitor.
The NYSE is like High Street in London, or the Avenue des Champs Elysées in Paris. It’s the place to be when you’re a large company looking to be listed on a stock exchange. In order to be listed on the NYSE you need to meet certain requirements, like having a share price greater than $4 and a market cap of at least $40 million.
The second largest stock exchange in the world. It is home to more than 3000 listed companies and its main index is the NASDAQ Composite. When the NASDAQ opened, it was the world’s first electronic stock market – where buyers and sellers are connected by computers.
- London Stock Exchange (LSE)
Located in the city of London, the LSE is the oldest stock exchange in the world. It was established over 200 years ago, in 1801, and has a market capitalization of $6 trillion. While it has only been known as the LSE for the last 200 years or so, the exchange can trace its history back to the 1600s.
- Tokyo Stock Exchange (TSE)
With over 2000 listed companies, the Tokyo Stock exchange is the largest of its kind in Asia. It used to be even larger, because in the late eighties the TSE accounted for over 60% of the world’s stock market cap. It’s fallen from its lofty perch since but still takes fourth place today.
- Shanghai Stock Exchange (SSE)
Headquartered in Shanghai, this stock exchange is one of two independent stock exchanges in China, the other located in Shenzhen. Due to tight capital controls in the country, this exchange isn’t completely open to foreign investors and the index used to reflect its performance is known as the Shanghai Composite Index.
- Hong Kong Stock Exchange (SEHK)
The Hong Kong Stock Exchange is the third largest exchange in Asia and has a market cap of $3 trillion. Some of the biggest stocks listed on the exchange include PetroChina, the Industrial & Commercial Bank of China and China Mobile.
Euronext was formed in 2000 after a huge merger between the stock exchanges in Amsterdam, Brussels and Paris. Since then it’s merged with a couple other exchanges to form the largest exchange in Europe. Think of it like the Voltron of stock exchanges.
- Shenzhen Stock Exchange (SZSE)
With a market capitalization of around $2 trillion, the SZSE is the eighth-largest exchange in the world. Many of the companies listed on this exchange are ones in which the Chinese government has a controlling stake in.
- Toronto Stock Exchange (TSX)
The Toronto Stock Exchange is the third-largest exchange in North America and lists various ETFs, income trusts and investment funds along with conventional securities. Many of the large companies listed on the TSX can also be found on the New York Stock Exchange.
- Frankfurt Stock Exchange (FWB)
Rounding out the top 10 is the Frankfurt Stock Exchange, owned and operated by Deutsche Börse AG. This exchange also has a long history, as its founding dates back to the 16th century, when a bourse was established to set up fixed currency exchange rates.
So there you have it folks. You Don’t have to travel half way around the world to get involved with companies from other countries. You can invest in places like China and Frankfurt form the comfort of your own home!