Forex glossary of terms
Toronto stock exchange (TSE)
The Toronto Stock Exchange, or TSE, is owned by TSX group, which also owns the TSX Venture Exchange, an important exchange for electricity and natural gas contracts.
The formation of the TSE dates back to 1852, when several Toronto businessmen periodically met with the intention of forming an association of brokers; however, there is no official record of their activities. In October 1861, two dozen Toronto businessmen passed a resolution in the Masonic Hall to create the Toronto Stock Exchange. Their main objective was to establish communications between members to facilitate the exchange of stocks, shares, bonds, mortgages, and other loans.
In 1861, fewer than two dozen companies, most related to banks and real estate, were listed. Trading was limited to daily half-hour sessions, and usually no more than two or three transactions occurred per day. In 1878, the Toronto Stock Exchange (TSE) was officially incorporated through an act of the Ontario legislature. The trading volume grew slowly, with periodic ups and downs, until the outbreak of the First World War.
In 1914, the TSE ceased for three months because of the financial dislocations brought on by the war in Europe, and Canada could no longer rely on the British market for raising capital. To finance the war effort, the Canadian government raised billions of dollars by issuing bonds, which were sold to its own citizens, as well as on the New York bond market. The war also stimulated Canadian industrialization, thereby generating a demand for capital. Throughout the Roaring Twenties, the TSE responded to this demand, and by late in the decade, the number of shares traded grew to over 10 million a year.
In 1934, the Toronto Stock Exchange merged with the Standard Stock and Mining Exchange and the merged markets adopted the Toronto Stock Exchange name.
The TSE has played a leading role in adopting modern technologies and ideas. In the 1970s, the TSE was the first exchange in the world to develop a computerized system to trade some of its stocks. In 1997, the TSE closed its trading floor in favour of electronic trading. In 1999, in order to compete with foreign exchanges, Canadas major exchanges reached an agreement to realign their responsibilities. The TSE has become the sole market for the preferred stocks or senior equities stocks that have priority over other stocks in the event of bankruptcy of the company. The Montreal Exchange (ME) has become the sole market for derivatives.
Since April 2000, the TSE itself began to operate as a for-profit corporationthe TSE issued its own stocks and declared its first quarterly dividend in January 2003. In May 2001, the TSE acquired ownership of the Canadian Venture Exchange (CDNX) and the TSE was renamed the TSX. In 2003, more than 1,400 companies were listed on the TSX and approximately $700 billion of share transactions took place.
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