How the London Stock Exchange works

Founded in 1801, The London Stock Exchange Group operates the main stock exchange of the United Kingdom, and the Italian stock exchange, Borsa Italiana. It is also involved in information technology through its Sri Lankan subsidiary MillenniumIT, and operates the stock indexes Russell Indexes and FTSE International, and has majority stakes in the clearing house LCH and electronic fixed income trading market MTS.

The Stock Exchange provides a mechanism for companies to raise capital to fund their business. The process of a company listing their shares on the exchange for the first time is often called an Initial Public Offer (IPO) or Floating.

The London Stock Exchange allows companies from around the world to list, not just UK companies. Actually, over 50 countries are represented in total. The exchange provides a mechanism for people around the world to trade shares in the companies listed on it.

In addition, the Stock Exchange provides information such as share prices and regulatory news. There are certain announcements that companies listed on the stock market are obliged to publish. These include details of trades in the company made by directors, changes to positions of the board of directors and financial updates.

It is worth mentioning that the Exchange also allows investors to trade more complex financial products beyond shares.

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