The Difference between NYSE and LSE

Background Information about NYSE and LSE

NYSE

You can find NYSE (the New York Stock Exchange) on Wall Street. It was launched in 1817 under a different name. It received its name NYSE in 1963. It is considered to be the most powerful stock exchange worldwide in terms of market capitalization.

However, its road to success was somewhat challenging. NYSE had to overcome the Wall Street Collapse in 1929, as well as Black Tuesday 50 years later. At the end of World War I, NYSE overtook the LSE. However, things change quickly in the field of stock market exchange, and in 2012, International Exchange took over NYSE.

LSE

The London Stock Exchange (LSE) is among the oldest stock exchanges in the world. It is located at Paternoster Square, in London. LSE was founded in 1801, though its origins could be found around a century before this, in 1698. Back at that time, the only thing that LSE did was to publish the market prices in paper two times a week.

LSE was the largest stock exchange before the end of World War I when NYSE overtook it. Now LSE is the 6th largest stock exchange worldwide and the largest one in its continent, Europe.

LSE is part of the London Stock Exchange Group, which was founded in 2007 with the merging of LSE with Borsa Italiana.  The London Stock Exchange Group represents more than 3000 companies from around 70 countries, so it is known as the most multicultural stock exchange.

Market Capitalisation

The market capitalization of LSE was estimated to have been $ 4.38 trillion in March 2018. The market capitalization of LSE is tracked through the FTSE 100 index (Financial Times Stock Exchange Index). This indicator consists of 100 of the companies enlisted in the London Stock Exchange. Some of these companies are GlaxoSmithKline, BP, and Barclays.

In March 2018, the market capitalization of NYSE was estimated to have been $23. 12trillion. This is much more than the one of LSE, and it is almost 40 % of the overall value of the world stock market.  NYSE represents more than 2400 companies from various fields such as energy, healthcare, and finance. Some of these companies are Citigroup Inc ( C ), Exxon Mobil Corp (XOM), and Pfizer Inc (GE). The index that is mostly used to track the value of NYSE is Dow Jones.

The Ways in Which NYSE and LSE Work

According to how these two stock exchanges work, they are entirely different.

LSE organizes special events (auctions) that typically occur before opening and after closing. LSE can be market-maker driven or order-book driven, which depends on the market cap of a particular stock.

NYSE is an auction-driven market. It relies on liquidity and on the fact that the representatives of the public meet each other most of the time. Whenever there is no liquidity, some experts emerge to fill in the gaps. This method proves to be the better one since NYSE is the best stock exchange in the world.