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Tel Aviv Stock Exchange
Organized trading in securities in Israel dates back to the 1930s. The development of
the Tel Aviv Stock Exchange's trading systems reflects the gradual growth of the country's
capital market - initially, as a very modest one during the British Mandate, with a
colonial economy based mainly on agriculture - to the market of an independent young
country influenced by a socialist tradition calling for a planned economy.
Later, during the first three decades of Statehood, until 1977, most of
the capital market's activity centered on the trading of government bonds; trading in
shares was sparse - in terms of the number of companies being listed as well as the volume
of trading generated by their shares.
The Semi-Continuous System
The 100 most liquid shares ("mishtanim") are traded within a
semi-continuous auction system, in three trading arenas, between the hours of 11:30 and
15:45. Trading is held without its participation of market makers or a central book of
limit orders.
The Computerized Call Market
Since June 1992, all securities other than the 100 most liquid shares are traded via
the Computerized Call Market (CMM) System. This system was introduced in September 1991,
when it was used on an experimental basis for 30 securities. In December 1994, all
(approximately 1,200 including MERETZ) shares, warrants and convertible debentures and 400
bonds were being traded via this system.
Trading in Options on the Maof-25 Index
Since August 1993, options on the Maof-25 Index, the index of the twenty five shares
with the highest market value, have also been traded on the Tel Aviv Stock Exchange. The
traded options are of both the call and the put types, and they may be exercised only on
their expiration date ("European Options"). The longest exercise period is four
months, and low exercise price options are also traded (LEPO).
Source: Trading Systems On The Tel Aviv Stock Exchange
by: Saul Bronfeld, TASE Managing Director
A further discussion of the this
article.
The Tel Aviv Stock Exchange Web site is located at
www.tase.co.il.
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