Friday, May 14th, 2010
Australian share trading began in Sydney shortly after the foundation of The Bank of New South Wales in 1817. The market was especially thin in the first decade with only three companies in existence. The earliest recorded effort to sell shares was when a solicitor placed a newspaper advertisement to sell two shares in The Bank of New South Wales. Interestingly one of the earliest advertisements to purchase shares came from a M. Hindson of 7 Macquarie Place, Sydney. The same address that Clime resides in today. These cumbersome procedures eventually lead to shares being auctioned, in many cases alongside real estate and livestock.
Although share trading began in Sydney, Melbourne was first to establish an organised Stock Exchange in 1857 followed by Sydney in 1871, Hobart in 1882, Brisbane in 1884, Adelaide in 1887 and Perth in 1889.
Federation in 1901 turned the colonies of Australia into states of the Commonwealth of Australia however it took a little longer for the state based stock exchanges to form a national exchange. This occurred in 1987 when after considerable discussions the Australian Stock Exchange was formed. The Australian Stock Exchange was the first exchange in the world to demutualise when it float itself on its own market. In October 1998, the 606 members of the exchange were each given 166,000 shares.
Australian Securities Exchange Limited (ASX:ASX) was formed in July 2006, upon the merger of the Australian Stock Exchange and the Sydney Futures Exchange (SFE).
ASX today is Australia’s primary stock market and deriver’s revenue from the listing and trading of securities and derivatives, capital formation via initial public offerings (IPO’s). It functions as an operator, supervisor, central counterparty clearer & payments system facilitator to the Australian equity and futures markets. Customers include listed companies, corporates, investment and trading banks, fund managers, hedge funds, traders and retail and professional investors. It makes its money by charging fees for the issuance, trading, clearing and settlement of securities and derivatives. The ASX goal is to build it’s franchise and reputation by leveraging its platforms, diversifying its revenue streams and growing international distribution.