London Stock Exchange

The London Stock Exchange, or the LSE as it is also known, is one of the largest stock markets in the world. The London Stock Exchange has its roots in the early British empire. Since that time, it has evolved into a larger exchange, with billion dollar corporations and a full 3,233 companies on the list. Trading times begin halfway through the US trading session and often have a large impact on the overall trading for the day.

Fulfilling the Network of Stock Exchanges

In a world with multiple stock exchanges in every developed nation of the world, the London Stock Exchange is very important because of the timeframe in which it encompasses. After the close of the US stock markets, hedge funds and many other large institutional investors make their way to London for the final hours of trading. These stock traders generally leave the London markets, going into Asian markets to round out the day before US trading begins again.

London Stock Exchange Uses Two Stock Quotes

The London Stock Exchange can be a bit deceiving in the prices quoted for stocks. In other markets, stock quotes are given in just one currency denomination. On the LSE, stock quotes can be quoted in both pence and pounds, making the prices more confusing than with other markets. When a price is quoted in pence, it uses the abbreviation GBX, while for pounds, GBP is used. The difference between the two is a multiple of 100, thus a 55 pence stock may be seen as a 55 pound stock. Reading the stock tables and stock quotes for LSE stocks requires more research and understanding than other markets.

Dually-listed Corporations

Many stocks enjoy listing on multiple stock exchanges. For example, US companies often have stock in foreign markets, such as the LSE, while UK operations are often listed on US stock markets. The benefit of two stock markets means an extended trading day for experienced stock holders and a new market to tap for equity to expand. Any large corporation in the United States is listed with the LSE, especially if they have UK operations.

The FTSE 100

Much like the Dow Jones Industrial Average or NASDAQ composite index, the London Stock Exchange has its own index to track the returns of the larger corporations in the marketplace. In recent years, the LSE has grown in popularity with futures and exchange traded fund traders who enjoy the thrill of investing in foreign markets.

The Propagation of Stock Markets

Within the last 10 years, the expansion of ETFs and foreign stock mutual funds has brought the London Stock Exchange closer to the US markets. Stock markets have spread their reach beyond their boundaries by giving investors all over the world the opportunity to invest with the same ease as local citizens. The London Stock Market is a great way for US traders to be able to trade actively in the evening and squeeze a few extra hours of trading into each day.