Stock Trading in South Africa

Stock trading is not limited to only a few of the most popular exchanges. Many investors today are looking to enter alternative markets, such as South Africa. The major South African exchange is the Johannesburg Stock Exchange (JSE) Limited, which has a long history and is highly regulated to uphold its integrity and protect investors.

History of the Johannesburg Stock Exchange

The Johannesburg Stock Exchange was founded as the Johannesburg Exchange and Chambers Company in 1887 by London businessman Benjamin Wollan. By 1890, the original building had become too small for all the activity, and trading had spilled outside, forcing the street to close. A new building was contructed, but this scenario would be replayed several times over the course of the century. The latest building was completed in September 2000.

In 1993, the exchange became a founding member of the African Stock Exchanges Association (ASEA), and three years later, trading was converted from the old outcry system to an electronic system. The exchange was further modernized in 1995 when the Stock Exchange Control Act of 1985 was amended to allow corporate broker membership and foreign members, both of which opened the door to day trading.

In 2001, a new agreement introduced cross dealing with the London Stock Exchange (LSE), and in 2009, futures trading for two American companies, Microsoft and Google, was introduced. In 2012, the exchange became one of the first members of the United Nations Sustainable Stock Exchanges, and the latest milestone occurred in 2013 when a new trading platform was implemented that can handle trades 400 times faster than the previous system.

About the Johannesburg Stock Exchange

The South African exchange is the largest on the continent and is now ranked among the 20 largest in the world. More than 400 companies are listed across the main board and the alternative board, known as the AltX, and market capitalization topped $1 trillion in 2013. Because of its prominence in international investing, this exchange seeks to offer efficient and secure stock trading through a wide range of financial instruments and services.

The JSE’s stock index was developed through a partnership with the FTSE Group, and the FTSE/JSE benchmarks cover more than 99 percent of the country’s market capitalization by tracking representative companies through several sectors.

The exchange in Johannesburg lists bonds in addition to stocks, and South Africa’s interest rate market is the continent’s largest. Most bonds in the nation are issued by the government and state-owned institutions, but the number of corporate bonds on the market is on the rise.

In addition to stock trading, the exchange also offers a variety of derivatives, many of which are perfect for day trading, and a full range of futures and options are available, including bonds, stocks, commodities, indices, foreign currency and interest rates.