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.
The correlation between the stock market and the economy is deeper than it might seem at first. Since many companies rely on stock markets to raise capital, if the share prices drop, firms struggle to raise capital and to grow, which in turn affects employment and economic growth.
Over the last decade and a half, the global market capitalization has more than doubled.
There are 60 major exchanges in the world, but 20 of them make up what’s known as the Trillion Dollar Club, because they have at least one trillion dollars in market cap. Many countries have their own stock exchanges.These 20 exchanges account for around 85% of the global market capitalization, which is worth over $76 trillion.
It’s no secret that 2017 has been a good year for stocks. Led by the biggest stock exchanges in the world, many of them have hit highs not seen in several years or even decades, and some have even gone on to post all-time record highs.
20. BM&F Bovespa
Market Capitalization: $837 Billion
BM&F Bovespa (Bolsa de Valores, Mercadorias & Futuros de São Paulo, or the São Paulo Stock, Mercantile and Futures Exchange, ticker code BM&FBOVESPA) is the one of world’s biggest and most strategically important stock and commodity exchanges. Based in São Paolo, Brazil, since its recent formation it has increased trading volumes year on year.
19. Taiwan Stock Exchange
Market Capitalization: $891,06 Billion
The Taiwan Stock Exchange Corporation is a financial institution, located in Taipei 101, in Taipei, Taiwan. The TWSE was established in 1961 and began operating as a stock exchange on 9 February 1962.
18. Madrid Stock Exchange
Market Capitalization: $931,2 Billion
The largest securities market in Spain, also known as the Bolsa de Madrid. In 1809, Jose I Bonaparte attempted to establish Spain’s first stock exchange in Madrid but it failed because Madrid was not a major business center at the time.
17. JSE Limited
Market Capitalization: $951,03 Billion
JSE Limited (previously the JSE Securities Exchange and the Johannesburg Stock Exchange) is the oldest existing and largest stock exchange in Africa. It is situated at the corner of Maude Street and Gwen Lane in Sandton, Johannesburg, South Africa.
16. NASDAQ Nordic Exchanges
Market Capitalization: $1.25 Trillion
The first of the 16 largest stock exchanges in the world in 2017 is the NASDAQ Nordic Exchanges, which are operated by NASDAQ Nordic, a subsidiary of Nasdaq Inc (NASDAQ:NDAQ). The company operates a number of markets, including the Copenhagen Stock Exchange, Stockholm Stock Exchange, and Helsinki Stock Exchange. The NASDAQ Nordic Exchanges have 938 listed stocks as of the end of 2016.
15. Korea Exchange
Market Capitalization: $1.25 Trillion
The Korea Exchange is the only securities exchange in South Korea and is headquartered in Busan, with offices for cash markets and market oversight in Seoul. During 2017, the Korea Exchange registered a growth in total market capitalization of 4.5% and it has 2,059 listed companies as of the end of the last year, up from 1,961 companies at the end of 2016.
14. Australian Securities Exchange
Market Capitalization: $1.27 Trillion
The Australian Securities Exchange is located in Sydney, which is why it is sometimes referred to as the Sydney Stock Exchange. There are 2,095 companies listed on the Australian Securities Exchange, out of which 126 are foreign companies. In terms of the number of foreign listed companies, the ASX is the second-largest in the Asia-Pacific region, behind the Singapore Exchange. The ASX’s total capitalization advanced by 8.1% during 2016.
13. SIX Swiss Exchange
Market Capitalization: $1.40 Trillion
The Zurich-based SIX Swiss Exchange is Switzerland’s main stock exchange, with the other located in Bern, and ranks as the 13th largest of the 16 largest stock exchanges in the world in 2017. The SIX Swiss Exchange was the first in the world to launch a fully automated system for trading, clearing and settlement in 1995. The exchange is controlled by 55 banks, each of whom have equal voting rights. The SIX Swiss Exchange’s total market capitalization declined by 5.1% last year and it has 264 listed companies.
12. National Stock Exchange of India
Market Capitalization: $1.54 Trillion
The National Stock Exchange of India is the principal stock exchange in India and was established in 1992 in Mumbai. The NSE’s main index is the NIFTY 50, which includes 50 stocks of 50 companies and one DVR (differential voting rights shares) for Tata Motors (which also has regular shares). The Nifty 50 is used as a barometer of the Indian Capital Markets due to its inclusion of companies from all 13 sectors of the Indian economy. There are currently around 1,840 companies listed on the NSE. The total market capitalization of the NSE grew by 6.2% during the last year.
11. Bombay Stock Exchange
Market Capitalization: $1.57 Trillion
The Bombay Stock Exchange ranks 11th in our list of largest stock exchanges in the world in 2017. It has significantly more listed companies compared to the National Stock Exchange of India: 5,821. It is also located in Mumbay and claims to be the fastest stock exchange in the world, with a median trade speed of 6 microseconds. During 2016, the Bombay Stock Exchange’s total market capitalization increased by 5.8%.
10. Deutsche Börse
Market Capitalization: $1.72 Trillion
The Deutsche Börse AG operates the Frankfurt Stock Exchange, which hosts 592 companies as of the end of 2016, down from 619 companies a year earlier. The Frankfurt Stock Exchange is the largest of the seven regional securities exchanges in Germany and accounts for 90% of the turnover generated in the country. The Frankfurt Stock Exchange’s history can be traced back to trade fairs in 11th century Frankfurt and by the 16th century, the exchange was established to set up fixed currency exchange rates. Due to this exchange, Frankfurt is considered the birthplace of stock exchanges. During 2016, the total market capitalization of the Frankfurt Stock Exchange registered a growth of 3.8%.
9. Toronto Stock Exchange
Market Capitalization: $1.99 Trillion
During 2016, the Toronto Stock Exchange saw one of the largest capitalization growths among stock exchanges based in the Americas and was the growth leader among the 16 largest stock exchanges in the world in 2017. The total market capitalization of the Toronto Stock Exchange surged by 21.4% during the last year, although the number of listed companies declined to 3,419 from 3,559. The Toronto Stock Exchange is owned and operated as a subsidiary of the TMX Group.
8. Hong Kong Stock Exchange
Market Capitalization: $3.19 Trillion
The total market capitalization of the Hong Kong Stock Exchange inched up by 0.3% during 2016, but the number of listed companies advanced by 107 to 1,973. The Hong Kong Stock Exchange is owned and operated by the Hong Kong Exchanges and Clearing and it is one of the few exchanges that still have a physical trading floor, although it accounts for less than 1% of the trading volume.
7. Shenzen Stock Exchange
Market Capitalization: $3.21 Trillion
The Shenzen Stock Exchange that’s up next in our list of largest stock exchanges in the world in 2017 has 1,870 listed companies, fewer than the Hong Kong Stock Exchange, but more than the largest Chinese stock exchange, the Shanghai Stock Exchange. During 2016, its total market capitalization declined by 5.5%, although a year earlier it surged by over 75%.
6. London Stock Exchange
Market Capitalization: $3.41 Trillion
We are continuing our list of largest stock exchanges in the world in 2017 with the London Stock Exchange is owned and operated by the London Stock Exchange Group plc, which also owns Italy’s only stock exchange, Borsa Italiana. Over the last few decades, the London Stock Exchange was involved in a number of attempts to merge with the Toronto Stock Exchange, the NASDAQ, and the Deutsche Börse, but all deals fell through. There are 991 UK companies and 267 international companies currently listed on the London Stock Exchange.
Market Capitalization: $3.46 Trillion
Euronext is a stock exchange based in Amsterdam, Brussels, London, Lisbon, and Paris. It is the largest of the 16 largest stock exchanges in the world in 2017 to be based in Europe in terms of total market capitalization, and currently hosts 1,051 listed companies, which include 936 domestic and 115 foreign companies. During 2016, Euronext’s total market capitalization went up by 8.6%. In 2007, Euronext merged with NYSE Group to create NYSE Euronext and in 2013, Intercontinental Exchange Inc (NYSE:ICE) acquired the combined company. However, in 2014, Euronext separated and went public as an independent company.
4. Shanghai Stock Exchange
Market Capitalization: $4.10 Trillion
The Shanghai Stock Exchange is the largest stock exchange in China in terms of total market capitalization and is the second-largest in Asia. The Shanghai Stock Exchange is not completely open to foreign investors and has two types of stocks, “A” and “B”, with only “B” shares available to foreign investors. There are 1,182 companies listed on the Shanghai Stock Exchange and its total market capitalization declined by 3.6% last year, after having appreciated by over 15% in 2015.
3. Tokyo Stock Exchange
Market Capitalization: $4.96 Trillion
The total market capitalization of the Tokyo Stock Exchange, the number 3 in our list of largest stock exchanges in the world in 2017 inched down by 1.7% last year and it currently has 3,541 listed companies, the second-largest number after the Bombay Stock Exchange. The Tokyo Stock Exchange is owned and operated by the Japan Exchange Group, which was formed in 2013 after the Tokyo Stock Exchange merged with the Osaka Securities Exchange.
Market Capitalization: $7.78 Trillion
The NASDAQ Stock Market ranks second in our list of largest stock exchanges in the world in 2017. It is owned by Nasdaq Inc (NASDAQ:NDAQ). Its name represents an acronym of “National Association of Securities Dealers Automated Quotations” and it was founded in 1971 by the National Association of Securities Dealers (NASD). At its foundation, the NASDAQ was the first electronic stock market and was the first stock market in the U.S to offer online trading. The possibility of online trading attracted many large tech companies, such as Microsoft Corporation (NASDAQ:MSFT) and Apple Inc (NASDAQ:AAPL), which is why it has become common for tech companies to choose to list their shares on the NASDAQ. There are currently 2,897 companies listed on the NASDAQ and its total market capitalization grew by 6.8% during 2016.
1. New York Stock Exchange
Market Capitalization: $19.57 Trillion
The New York Stock Exchange, owned by Intercontinental Exchange Inc (NYSE:ICE), was the only other stock exchange with a market capitalization exceeding $1.0 trillion that grew by double-digits during 2016. Its growth amounted to 10%, but in absolute terms, the market capitalization increased by $1.79 trillion. During 2016, the New York Stock Exchange registered 1.85 million trades, during which some 356.13 billion shares changed hands.