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The South Sea Bubble
South Sea Bubble is a speculation mania that caused financial ruin for many British investors.
After rising from 128 to over 1,000 in nine months, the bubble of overvalued stock burst and the price per share dropped to 124, dragging other stocks down and leaving many investors ruined.
- The incident caused outcry, forcing the government to pass legislation to prevent another bubble, which laid the foundation of the rudiment of london stock exchange. -
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Fish and stocks
The London Stock Exchange is a stock exchange located in the City of London in the United Kingdom. As of June 2011, the Exchange had a market capitalisation of US$3.7495 trillion, making it the fourth-largest stock exchange in the world by this measurement (and the largest in Europe) -
Formation of London Stock Exchange
The committee of Proprietors representing those who owned the stock exchange building suggested that it should be converted into a subscription room.These proprietors were also major users of the market.
On March 3rd 1801 the London stock exchange formally came into existence and provided a market for securities.
In addition it incorporated regulations on how business was to be conducted. These rules and regulations were monitored by a committee. -
First Rule Book
In February 1812, the General Purpose Committee confirmed a set of recommendations, which later became the foundation of the first codified rule book of the Exchange.
Even though the document was not a complex one, topics as settlement and default were, in fact, quite comprehensive.
With its new governmental commandments and increasing trading volume in place, the Exchange was progressively becoming an accepted part of the financial life in the City. -
Foreign and Regional Exchanges
The ever-increasing of overseas business meant eventually the dealing in foreign securities had to be allowed within all of the Exchange's premises.
Domestic Great Britain also benefited from the economic boom. Two other cities were particularly showing great business development, namely Liverpool and Manchester.
Consequently, in both cities Stock Exchanges were opened.These were also times when stockbroking was considered a real business profession and such attracted many entrepreneurs. -
First World War
Being the financial center of the world, the Stock Exchange was hit hard by the outbreak of the First World War in 1914.
The Stock Exchange ended up being closed from the end of July until the New Year, introducing again street business as well as on the “challenge system”.
The Exchange was set to open again on 4 January 1915 under tedious restrictions, Due to the limitations and challenges on trading brought by the war, almost a thousand members quit the Exchange between 1914-18 -
Coat of Arms
The London stock exchange received its own coat of arms, a maritime brokers' motto.
Brokers said, "My word is my bond" (in Latin "dictum meum pactum"), since after 1801 bargains are made with no exchange of documents and no written pledges being given. -
"Big Bang"- deregularions in market
The biggest happening of the 1980s was the sudden deregulation of the financial markets in the UK.
London Stock Exchange (LSE) became a private limited company.
The event revitalized the LSE because outside corporations were allowed to enter its member firms, automated price quotation was established, minimum scales of commission are abolished, individual members cease to have voting rights. -
Governmental change
Governmental changes continued in 1991 when the governing Council of the Exchange was replaced with a Board of Directors drawn from the Exchange’s executive, customer and user base. This also marked the first time the trading name became "The London Stock Exchange"(became a public limited company). -
Alternative investment market (AIM)
AIM is the London Stock Exchange’s international market for smaller growing companies.
AIM has raised almost £24 billion for more than 2,200 companies. Flexibility is provided by less regulation and no requirements for capitalisation or number of shares issued. Some companies have since moved on to join the Main Market.
AIM has also started to become an international exchange, often due to its low-regulatory burden; over 270 foreign companies had been admitted to the AIM. -
Stock Exchange electronic Trading Service(SETS)
SETS is the London Stock Exchange’s flagship electronic order book, trading indexed securities (FTSE100, FTSE250, FTSE Small Cap Index constituents, Exchange Traded Funds)
SETS is one of the most liquid electronic order books in Europe. It is this liquidity, underpinned by a rigorous rulebook and market supervision that attracts so many participants creating unrivalled opportunity to do business.
