A Glimpse at ASX

There have been three known methods undertaken by which Australian stocks have been traded ever since the very first Australian
exchange was founded in 1861 and took place in Melbourne, the second most populous city next to Sydney. The first method simply
involved talking: a call out system of sorts. It was as easy and as simple as announcing the available stocks for bidding.
This particular method, however, was scrapped when the volume of trading dramatically soared as a result of the mining boom in 1969.
The verbal auction was “silenced” and a new system was introduced by the Australians. Aptly called the chalk system, Australian
traders (better known that time as “chalkies”) would write down on chalkboards (using chalks of course).

Stock exchange exists in each major city in Australian, and there were actually six various exchanges applicable for Australian
stocks. In the late 1980’s, in 1987 to be precise, The Australian Stock Exchange or ASX was introduced and this new entity paved
way for Australians to use a state-of-a-kind trading platform: a fully-digital trading platform, that is.

The Stock Exchange Automated Trading System or SEATS is that all-digital trading platform that made all those shouting and scribbling
in chalks a part of a bygone era. The trading floors were closed since the automation or digitalizing of the trading system was executed.
The almost staggering prices of fees appropriated for brokerages dramatically went down due to the advent of SEATS. Brokerage fees
indeed reached its lowest rates and it’s apparent with fees that go between .12 AUD to .18 AUD. Said fees are prevalent. Primarily,
stockbrokers were in full grasp of ASX until its demutualization took place. In 1996, it was included in the public list of companies in Australia.

When Australian BHP merged with British Billiton, the biggest mining corporation in the world was created. The result is BHP Billiton
(a huge global producer of petroleum, iron, coal, bauxite and even diamonds) that with reports in 2004, it was noted that the said company
has the largest stock in ASX amounting to a total of 6.6% market capitalization, and this fact placed ASX in the 8th place among the largest
exchanges in the world. Under 2000 stocks, it has become home to a little above 2% of world wide stock capital listing. Everyday, there are
approximately 99,300 trades placed on the exchange.

Trading hours on the exchange occurs between 10:00 A.M. to 4:00 P.M. (Sydney time). Stocks are opened at different intervals. For the first
ten minutes, one will observe that sectors appear to open aimlessly. Well, do expect that sectors would commence opening casually. This action
is practiced to ensure that traders will not timing the transactions once they opened.

In Australia, Macquarie Bank is the lone major bank that involves itself in the exchange. Still, one will also find banks that trade internationally and are known huge players in the global arena such as Deutsche Bank, Goldman Sachs and Morgan Stanley participating on the exchange along with Macquarie. In the London Stock Exchange, Macquarie Bank made a bid in February 2006, but unfortunately the bank was repulsed, or to say it in another way, was given the cold shoulder.

Australia’s markets are made up of foreign ownership (40% and the biggest), retail investors (30%) and Institutional ownership (30%).