The global capital market is undergoing a series of
major structural changes, due largely to demutualization, consolidation,
and competitive threats from alternative trading systems.
The exchange industry is evolving rapidly. Worldwide
competitive pressure has motivated many exchanges to change their
structural model of governance from member-owned and not-for-profit
organizations to publicly traded companies. The 12 major exchanges are all
demutualized organizations in terms of revenues, and only four of them are
unlisted companies.
The exchange industry has consolidated at both the
regional and global levels. This process has been accelerated over the
past two years with the NYSE-Euronext merger, which created the largest
stock exchange worldwide, in addition to the merger of CME and CBOT, which
resulted in the world’s largest derivatives exchange. According to a new
report from Celent, Global Securities Exchanges Landscape,
demutualization and consolidation will continue in the near future.
“Demutualized structures are more flexible and
reactive to the fierce competition,” said Perrine
Fiorina, Celent analyst and author of the report. “Consolidation
represents the means of achieving revenue and cost synergies towards
expanding trading activities and diversifying revenue sources."
Other key findings of the report include:
- The majority of exchanges diversify their revenue
sources and not only provide listing, trading, and information
services but also post-trading services and technologies.
Furthermore, many exchanges offer both securities and derivatives
trading.
- The American NYSE and Nasdaq exchanges are still
leaders in volume and value, but exchanges in the Asia-Pacific region
have been the most dynamic and fastest growing markets over the past
two years.
- The global value of initial public offerings
reached a record in 2006, with US$246 billion raised through 1,729
IPOs. The first half of 2007 has also been impressive.
- Derivatives instruments have become more and more
popular, with global derivative trading volume increasing by a
compound annual growth rate of 22% between 2000 and 2006.
This report also provides an analysis of the major
equities and derivatives exchanges’ strategies towards facing
competition with alternative trading systems (ATSs), brokers, and private
equity firms.
A table of contents
is available online. The 31-page report contains 22 figures and four
tables.
