History of the Toronto Stock Exchange
The history of the Toronto Stock Exchange , the largest stock exchange in Canada and the third largest in America, goes back to the British colonial era. However, the time of origin cannot be precisely determined. What is certain is that on July 26, 1852, a group of Toronto entrepreneurs gathered to found an "Association of Brokers". Today's stock exchange regards this date as the date of its founding, and accordingly celebrated its 150th anniversary in 2002. However, since the "founders" kept no records, it is unclear whether they actually traded in company shares.
Through the merger with the commodity exchange, the TSX became the third largest exchange in North America, the trading volume and the number of employees rose so much that it had to move to larger buildings five times. The TSX was the first American exchange to introduce computer trading in 1977 . It has been a profit-oriented company since 2000 and acquires in the field of securities trading, but also news companies and commodities trading.
Formal establishment
The stock exchange known as the Toronto Stock Exchange was formally established on October 25, 1861, six years before the Canadian Confederation was founded . That day, 24 men gathered in the Masonic Lodge . For a membership fee they could take part in trading, which was normally limited to two to three transactions per day. Every day only 18 stocks were traded for half an hour. Ten years later, the stock exchange had 14 member companies that got a seat for a fee of $ 250. That fee rose to $ 12,000 by 1901.
After its incorporation by the Legislative Assembly in 1878, the exchange had its first permanent seat at 24 King Street East, but in 1901 it moved to number 20. There was now trading in the form of a permanent auction .
In 1901, around one million shares were traded each year and 100 companies were listed.
From moving to Bay Street to the Great Depression
In 1913 the stock exchange moved into its own building on Bay Street . New technologies, as the first news ticker , to observable letter - and bid prices were asked. But at the beginning of the First World War , the stock exchange closed on July 28, 1914, as panic selling had occurred, similar to New York . The exchange did not open its doors again until the end of October.
During the war, sales and prices rose sharply, but at the end of the war a significant inflation set in , which was followed by a phase of recession . The raw material prices collapsed. In the recovery phase from 1922 to 1926, the value of the securities issued rose to over $ 700 million; in 1924 only 908,000 securities were traded per year, in 1929 more than 10 million.
With the global economic crisis , the volume of trade initially shot up, but while more than 2000 investment and brokerage houses had to be closed in New York , the companies involved did not go bankrupt in Toronto .
Merger to form the Toronto Stock Exchange , relocation to Bay Street
In 1934, the Toronto Stock Exchange was merged with the Standard Stock and Mining Exchange , which had existed since 1868 and was the main competitor of the TSE until then. Above all, it was a raw materials exchange. It was not until this unified exchange was called the Toronto Stock Exchange . The combined trading volume was over $ 534 million, and two years later the exchange was the third largest of its kind in North America.
In 1937 the stock exchange moved again, this time to 234 Bay Street, the first building in Toronto with air conditioning .
Post War Boom, President Howard Graham
During the boom after World War II , the volume of trade increased sharply and in 1966 comprised one billion shares with a total value of 2.6 billion dollars. The seat in the stock exchange already cost $ 100,000 in 1955. In order to limit the possibilities of manipulation, from 1958 onwards the companies had to report every event that could have an impact on share prices ( ad hoc notification obligation ). In addition, in 1960 the tradition of electing the president from among member companies was broken. The Lieutenant General of Ontario, Howard Douglas Graham, was the first non-member elected to this position (1961-1966).
Computer Trading, King Street West, J. Pearce Bunting (1977-1995)
From 1977 to 1995 J. Pearce Bunting was President of the Stock Exchange. In his first year in office, computer trading began when the Computer Assisted Trading System (CATS) was installed. In addition, the TSE 300 Composite Index® was introduced as an index . It covered the price trend of the 300 largest Canadian public companies until 2002, when it was replaced by the S & P / TSX Composite Index . The Toronto 35 Index® followed in 1987 .
By 1980 the trade volume rose to 3.3 billion pieces with a value of 29.5 billion dollars. This means that around 80% of Canadian trade was handled in Toronto.
In 1983 the exchange moved to its current location at 130 King Street West. Four years later, the trading volume topped 100 billion dollars for the first time, but on October 19, 1987 the global stock market collapsed and the Toronto Stock Exchange lost 400 points, which was more than 11%.
End of floor trading, Rowland Fleming (1995–1999)
From 1995 to 1999 Rowland W. Fleming succeeded his predecessor Bunting in office. Under his aegis in 1996 the conventional computing system was abandoned in favor of the decimal system . This was due to the fact that Canada, in contrast to the USA , deviated from the old measures such as miles , barrels or acre .
In 1997, Toronto became America's largest stock exchange based on electronic trading. The floor trade was closed on April 23, 1997.
Profit-oriented company , division of labor, TSX , Barbara Stymiest and Linda Hohol (1999 to 2004)
Fleming was replaced in 1999 by the first woman to serve as President and Chief Executive Officer . Under Barbara G. Stymiest , a division of labor was developed between the three stock exchanges Toronto, Montreal and Vancouver . The so-called senior equities were now traded exclusively in Toronto, the Montreal Exchange specialized in derivatives and the Vancouver and Alberta Stock Exchanges were responsible for junior equities . A little later, the Canadian Dealing Network (CDNX), Winnipeg Stock Exchange and share trading on the Montreal Exchange merged into the CDNX.
The Toronto Stock Exchange has now received Royal Assent from the Lieutenant Governor of Ontario to convert the stock exchange into a for-profit company. It did so on April 3, 2000. In 1999, 29.3 billion shares were traded here for a total value of $ 529 billion. At the height of the boom in March 2000, more than 100 billion shares were trading. In May, the total was worth $ 15 billion and the Toronto Stock Exchange opened an office in Montreal (followed by another in 2002, also serving junior and senior issuers in Quebec).
In the following year, it also acquired the Canadian Venture Exchange - in turn, it emerged from the Vancouver Stock Exchange (VSE) and the Alberta Stock Exchange (ASE) - which has been called the TSX Venture Exchange since 2002 . As early as December 2001, trading with the companies listed on the Toronto Stock Exchange began.
New indices appeared to be necessary in order to map the trading processes in more detail and to make them easier to understand for derivatives traders. This is how the S & P / CDNX Index was created on December 10, 2001 , and has been trading under the name S & P / TSX Venture Composite Index since May 2002 . In 2002, Standard and Poor’s agreed to manage the Toronto Stock Exchange 300 Composite Index , now known as the S & P / TSX Composite Index .
TSX Markets , a branch of the TSX Group , began setting up new trading systems in 2002, such as POSIT, an abbreviation for Process Optimization, Standardization and Innovation Technique, a standard for measuring global business processes, and Iceberg Orders , which have only one in the order book Part of the incoming orders must be represented, the eponymous "tip of the iceberg".
On April 8, 2002, the Toronto Stock Exchange Inc. adopted the acronym TSX , the Canadian Venture Exchange was called TSX Venture Exchange , the TSE / CDNX Markets was now called TSX Markets .
Stymiest was replaced by Linda Hohol in 2002 . One of the most urgent tasks was to cope with the sharp rise in trading volume and its increasing speed. The TSX Datalinx exchange was launched , and TSX Markets acquired a 40% stake in CanDeal for the professional market.
IPO, new sales records
The stock exchange itself also went public in 2002 and celebrated its 150th birthday. This year, 46.3 billion shares were traded. The first quarterly dividend of 15 cents was already paid out in January 2003 . On April 29, this rose to 18 cents, and on May 8 the first general meeting took place. Business was so good - 55.5 billion shares traded in 2003 - that a special dividend of $ 5 was paid out at the end of the year. In 2004 the quarterly dividend rose from 18 to 25 cents, at the same time the exchange acquired NGX Canada Inc. , an electronic clearing house for natural gas and electricity contracts, for $ 38 million . In January 2004, the trading volume rose again to a record volume of 7.2 billion securities, the July dividend rose from 25 to 33 cents per share. In October 2006 the trading volume climbed to 64.17 billion shares.
The ever more complex trade required complex organizational structures. Market on Close started in March 2004 simply to ensure stable orders and prices at the end of a trading day .
Richard Nesbitt (2004 to 2008)
On 2 December 2004 Richard Nesbitt was Chief Executive Officer of TSX Group Inc . Attempts have been made for years to attract investors through advertising days in London , Frankfurt and New York , and in January 2005 a delegation traveled to China for this purpose . In autumn 2006 one to Australia , China, South America and Israel followed .
In April 2005 the general meeting took place for the first time in Calgary , whereby the shares were split in the ratio 2: 1. The dividend rose to 40 and 20 cents respectively. Corresponding to the new number of shares, which had doubled, the dividend per share rose to 25 cents (50 cents before the split).
In November, the trading volume rose again to a new record of 944 billion dollars, and exceeded the trillion mark for the first time in December. Overall, the value rose 29% to $ 1.1 trillion. With the new TSX Venture 50TM index , the 50 most important companies have come more into focus.
On February 1, 2006, the dividend rose again, from 25 to 33 cents. Two days later, the TSX Group and the DeGroote School of Business at McMaster University established a research center for capital markets studies. In August the TSX Capital Markets Initiative followed at the University of British Columbia , or at the law school.
Richard Nadeau now ran TSX listings in Montreal.
Further technical innovations were inevitable, and the website (tsx.com) was modernized at the same time. The alliance with Thomson Financial, which came into being in June and which TSX Connect set up to support analysis, was less intended for the general market than for the professional . Thomson Financial took over Reuters in April 2008 .
But not only did the specialty markets expand, the company also grew through investments, such as Oxen Inc. and Alberta Watt Exchange (Watt-Ex) acquired in August from the TSX subsidiary Natural Gas Exchange (NGX ). The exchange thus acted as a shareholder in the raw materials sector. Shorcan Brokers Ltd. followed in October .
Finally, in October 2006, a letter of intent was signed with the Brazilian stock exchange ( BOVESPA ) to promote joint listings and the exchange of information.
Economic crisis
Shortly before the Second Great Depression, the Toronto Stock Exchange increased its quarterly dividend in January 2007 to 38 cents. In August it announced that it would buy back 6,841,051 of its own shares, which on July 24, 2007 corresponded to ten percent of the total volume. On May 11, 2007, the S & P / TSX Composite , the main index of the Toronto Stock Exchange, was above 14,000 points for the first time - on November 20, 2008 it was quoted at around 7,700.
On June 6, the stock exchange announced the information service for investors, Equicom Group Inc. to have taken over.
On August 16, 2007, when the economic crisis, then known as the real estate crisis, entered, 708 million shares were traded, with a total of 996,311 transactions. A new record had already been set on August 10 with 707,853 transactions.
On December 10th, an agreement was reached with the Montreal Stock Exchange on the merger of organizational elements to form the TMX Group Inc. Two days later, TSX Quantum , an even more efficient trading platform, was launched.
Interim management
Chief Executive Officer Richard Nesbitt resigned on January 7, 2008. Rik Parkhill and Michael Ptasznik were appointed as interim leaders.
In February 2008, the exchange announced that it would have a second order book in addition to the TSX QuantumTM central limit order book . This order book , known as TSX InfinityTM , is aimed primarily at fast traders.
According to its own information, the TSX Group currently employs around 500 people.
Web links
Remarks
- ↑ This and the following from (PDF, 164 kB): The Group History at a Glance, 2008 ( Memento of December 4, 2008 in the Internet Archive ) (PDF; 12 kB).
- ^ Norman Hillmer, William Johnston: Howard Graham ( English, French ) In: The Canadian Encyclopedia . Retrieved August 21, 2016.
- ↑ TSX Quantum ( Memento of May 18, 2012 in the Internet Archive )