Tokyo Stock Exchange (TSE)
August 4, 2023
It is not exaggerating to say that Tokyo is driving the economy of the whole of Japan. It is the second-largest urban economy after New York City. So, it is normal to have the Tokyo Stock Exchange among the world’s biggest trading platforms. There are more than 3,500 companies listed on this exchange. Here at Aron Groups, we will discuss this exchange’s history and function to help you digest the importance of TSE in the world. Notably, the abbreviation TSE should not be confused with the Toronto Stock Exchange, known as TSX. Stay tuned.
Table of Contents
How does Tokyo Stock Exchange work?
To understand the function of the Tokyo stock exchange rate should look back at its performance. In 1989 when the asset price bubble was about to burst, the Nikkei 225 index reached an all-time high of 38,916, but in the following two years, the market experienced a dramatic trunk of market capitalization. The Japanese economy at that time was struggling with a recessionary environment.
Tokyo Stock Exchange
Tokyo is pursuing an aggressive growth strategy to increase the growth of Japanese companies. This strategy attracted more than 24 million investors to Japan, and the number of people travelling to Tokyo is Rising; Tokyo is the engine of the Japanese economy, which benefits from technological advancement, a strategic attitude, economic infrastructure and a perfect attitude.
The TSE, or the Tokyo Stock Exchange is the largest Stock Exchange in Asia and Japan. It is located in Tokyo. The exchange uses two indexes: Nikkei 225 and the TOPIX index.
Nikkei 225: This index weighs prices for the top 225 Japanese countries in the exchange.
TOPIX index: This exchange uses value as a scope for the first section of companies.
There are three types of sections in this market:
- The first group or section belongs to the largest companies in Japan, along with whoever would want to be listed on the TSE.
- The second group consists of middle-sized companies.
- The third group or better known as the ‘Mothers’ section, belongs to smaller companies from emerging Industries
The import Nikkei 225
The Nikkei 225 is considered to be the most important index in Japan and one of the oldest ones in the whole of Asia. It started to work in 1950 and is a weight which determines the price of a share according to its way. It is the corresponding index for Dow Jones.
The History of the Tokyo Stock Exchange
Tokyo stock exchange was launched in 1878. there were more than 3,784 companies listed on the exchange by 2021. The Japan Exchange Group owns the Tokyo Stock Exchange. The most popular Japanese companies, which are globally famous, including Toyota, Honda, Sony Corporation, Keyence Corporation and Mitsubishi, are listed in these exchanges.
At first, the TSE was a marketplace for government bonds, gold and silver currencies, later with the growth of the Japanese economy, stocks become the predominant trade in this exchange. It is worth to mention that Japanese stock exchanged were closed from 1945 to 1949. After the acceptance of the exchange by the American occupation authorities, the Tokyo Stock Exchange accounted for more than 90% of all Japanese Securities transactions.
The Tokyo Stock Exchange experienced a Dramatical collapse from 1991 to 2001 due to the first of the country’s equity and real estate bubble.
Downsides of the Tokyo Stock Exchange
Over the years, market participants have complained about the Tokyo Stock Exchange’s complexity. They argue that the market has become too large and complicated for traders.
There are five different sections in the Tokyo Stock Exchange. The main market consists of Section 1 and Section 2, which belong to Japan’s biggest and mid-sized Japanese companies. As previously noted, another section is dedicated to startups and is called the “Mothers”. And the last section is called Tokyo Pro Market, designed specifically for professional investors.
Companies must meet different regulations to be listed on each of these Tokyo Stock Exchange sections.
Working hours of Tokyo Stock Exchange
Tokyo Stock Exchange Is located in Nihonbashi Kabutocho, The biggest economic section of Japan. The TSE opens from Monday till Friday from 9:00 a.m. to 11:30 a.m., and it starts again from 12:30 to 15:00. The Tokyo Stock Exchange is closed on holidays.
Tokyo Stock Exchange Vs the Osaka Market
The Osaka Exchange is another important Marketplace in Japan, even older than the Tokyo Stock Exchange. The first trades conducted in the Osaka Exchange date back to 1673. At that time, the name of this market was Yodoya. In 1730, the market Location moved to Domjimaand, and the name changed to Dojima.
The Osaka Exchange, or the OSE, was launched in 1878. Finally in 2012, the Tokyo Stock Exchange bought the Osaka exchange and revived it
Start trading it Tokyo Stock Exchange
The Tokyo Stock Exchange is one of the most influential exchanges in Asia. To access this market, you can use Aron Groups’ services. We are providing trading platforms and years of experience with useful articles to help you try to make a profit. Here you will access a vast market including stocks, gold, Forex, crude oil, cryptocurrencies and commodities.
So, no matter how experienced or amateur you are, all you have to do is start learning more about your favorite market, use a demo account and look closely into international trades. The global market is filled with opportunities that await you. But only those who choose a reliable partner and educate themselves can benefit from the opportunities provided. Living in the 21st-century location is not a limitation, and you can access the NASDAQ exchange, the New York stock exchange and, of course, the Tokyo Stock Exchange. The most popular and largest exchanges from around the world or at the tip of your finger when dealing with Aron Groups.