By: Blayne Paulsen & Ryan Good

Today, the FSE covers the complete process chain including securities and derivatives trading and clearing, transaction settlement, custody, the provision of market information, and development and operation of electronic trading systems. Known as one of the oldest exchanges in the world. It dates back to an official exchange list, which provided 12 different currencies in It is the largest of 8 banks in Germany. The success of this exchange hasn’t been primarily due to the structuring of the company, but it was one of the first exchanges to go electronic. It began processing some of its data electronically in In 1997 the FSE launched Xetra, a fully electronic system. Which has made the exchange floor obsolete. Eurex: Market leader in trading and settlement of futures/options on shares, indices, ETFs and money market products.

The London Stock Exchange is one of the World’s largest stock exchanges. It deals in over 2800 domestic listed and 460 international companies. Its heritage dates back to 1698 when stock dealers were expelled from the royal exchange for “rowdiness.” They began selling and trading in the streets and coffee shops marked the date the first regulated exchange came to existence in London. (Now known as the LSE) “Big Bang” In 1997, the exchange made the move to an electronic system called SETS (Stock Exchange Electronic Trading Service). Created more efficiency to the exchange. Extranex

Established in 1792 with the Buttonwood Tree Agreement. Railroad companies dominated the exchange through the 1800’s. The NYSE’s first centralized location was a room rented for $200 a month at 40 Wall Street in 1817 (Burnt down in the Great Fire of New York). Bruno Des Forges becomes first non-US member on Exchange in NYSE allows foreign brokers/dealers membership on the floor modernization of trading floor wireless data system inaugurated on trading floor, allowing brokers to receive orders, access market information and transmit execution reports from any location on the trading floor. Today the NYSE is a major player in international trade, the capital market flow is generated from over 2805 domestic listed and 421 international companies.

NameTotal Number of Listed Companies Total number of Listed Foreign Companies Proportion NYSE % NASDAQ % London Stock Exchange % Singapore Stock Exchange % Tokyo Stock Exchange % Hong Kong Stock Exchange % Total %

Ownership of member firms by an outside corporation is allowed. Abolition of the distinction between stockjobbers and stockbrokers. Move from an open-outcry system to an electronic, screen based trading system. Deregulation of financial markets. Why all of the regulation change? Did new system improve the exchange?

Each of these exchanges are publically traded. FSE owned by Deutche Boerse Group LSE owned by London Stock Exchange Group Exchange competition- Mergers NYSE & Euronext China Why merge with Europe?

There are international exchanges located around the world. Why is there not an international exchange in Africa? Is this due to development? Does it effect their economy?

Hong Kong: A Product of What? Opium Wars of mid 1800’s Frank Lucas Must Be Jealous 1842  % Corporate Tax 2008: $27K/ PC GDP Equity Market: HKEX Gov./Fixed/Commodities IPO Leader

Democracy Vs. Communism One Country, Two Systems Both Are Effectively Capitalist HK = 70% Mainland Trading Float Disparity

Hang Seng Index: NOT a Stock Exchange HKEX formed in 1891 Similar to NYSE/SuperDot Ease of Listing Leader (top 5) in IPOs “H” Shares & Red Chips 1285 Companies (PRC + HK) $ Trillion HKD ($ 1.5 Trillion USD) June Restrictions Lifted: Now: Prior: Spot exchange deposits and foreign currency cash deposits

Shenzhen Stock Exchange: SSE Created listed companies, Small to Medium $1.7 Trillion USD Traded in Hong Kong Dollars Shanghai Stock Exchange: SSE (yes… the same) Created in listed Companies, Medium to Large $3.77 trillion USD Traded in US Dollars

Premiums on H Shares Supply/Demand Function No Arbitrage Channel What about hedge funds? Meanwhile in China… B Share Discount Why? Higher Liquidity Why…………?

Transfer of Power to Mainland WTO Impact China’s Growing Wealth (>$2 Trillion USD) Translation of Growth to Equity Markets A/B Shares Auction timing Premiums for Intl. Investors Loyalist Party Benefits H Shares/Red Chips Dual Listings China’s Control on the Markets What’s the Big Deal? SEC vs. SFC Vs. CSRC

Blayne Paulsen Frankfurt Stock Exchange London Stock Exchange New York Stock Exchange Comparisons Ryan Good Hong Kong Stock Exchange Shanghai Stock Exchange Shenzhen Stock Exchange Share Relationships