SIX Swiss Exchange facts for kids

The SIX Swiss Exchange is Switzerland's main stock exchange. It is located in Zürich. A stock exchange is a place where people can buy and sell parts of companies (called shares) and other financial items.

This exchange also trades things like Swiss government bonds, which are like loans to the government. It also handles derivatives, which are special contracts based on the value of something else, like stock options.

The SIX Swiss Exchange is fully owned by a company called SIX Group. This group is owned by about 120 banks and financial companies from Switzerland and other countries.

The exchange as we know it today was created in 1993. This happened when the Geneva Stock Exchange, the Basel Stock Exchange, and the Zürich stock exchange joined together. They formed an association known as the "Swiss Securities Exchanges Association," or Swiss Exchange for short.

This new association started trading in 1995. It was the first stock exchange in the world to use a fully automatic system for trading, clearing (making sure trades are correct), and settlement (transferring ownership).

In 1999, the association changed its name to SWX Swiss Exchange. Later, in 2002, it became a public company called SWX Swiss Exchange AG. In 2008, SWX Swiss Exchange joined with two other groups, SIS Group and Telekurs, to form the new SIX Group. At that time, it was renamed SIX Swiss Exchange, which is its name today.

The SIX Swiss Exchange uses several important indexes to track how the market is doing.

• The SMI (Swiss Market Index) is the most famous. It includes the 20 largest and most actively traded companies on the exchange.
• The SPI (Swiss Performance Index) includes over 200 companies listed on the exchange that meet certain rules.
• The SLI (Swiss Leader Index) is an index that tracks some of the 30 largest companies.
• The SBI (Swiss Bond Index) tracks bonds issued in Swiss francs.

In 2018, the total value of all companies listed on the SIX Swiss Exchange was about 1.6 trillion Swiss francs. This makes it one of the biggest exchanges in the world by total value.

In August 2023, the company joined with 13 other exchanges to create a new company called EuroCTP. This company aims to provide a single source of trading information for the European Union. This is part of a bigger plan by the European Commission to improve financial markets.

History of the Exchange

Early Swiss Exchanges

The first stock exchanges in Switzerland started in different cities. They needed permission from the local government, called the Cantonal authorities.

Geneva was the first, starting in 1850. Its trading floor opened in 1855. The Basler Börse followed in 1866, and one in Zürich opened in 1873. The Berne exchange, which still exists, began in 1884. Smaller exchanges also appeared in Lausanne (1873), St. Gallen (1887), and Neuchâtel (1905). These exchanges had to pay a tax to their Cantons.

During the First World War, most Swiss exchanges closed. Only bond trading continued in Geneva. After a difficult period in the early 1920s, the market grew quickly. A new exchange building was built in Zürich in 1929. This building is still there but is no longer used for trading.

After the Great Depression in the 1930s, a new banking law was created. This law is still important today. It requires banks to get permission from the FINMA to operate. It also includes rules about checking customer information and banking secrecy. Swiss exchanges were asked to join together to help the Swiss National Bank have more influence over the market.

After World War II

After the Second World War, fees for trading on exchanges were made the same. In the mid-1950s, the exchanges earned a lot of money, similar to before the wars. This continued until 1962, when the market slowed down due to economic changes and the Cuban Missile Crisis.

In the 1970s, the economy and financial world began to change a lot. This was partly because the United States stopped using fixed exchange rates. With changing exchange rates, businesses faced new risks and needed ways to protect themselves. This led to the creation of financial derivatives. In 1973, the Chicago Board Options Exchange was created just for trading these derivatives.

The oil crisis in 1974 caused a big economic downturn. In Switzerland, so much money was invested that people even thought about closing the exchanges.

The New Economy

In 1993, the Geneva Stock Exchange, the Basel Stock Exchange, and the Zürich stock exchange merged to form SWX Swiss Exchange. On August 16, 1995, the traditional trading floors closed for good. This ended more than a century of in-person trading. They were replaced by the world's first automated system for trading, clearing, and settlement.

After financial markets recovered from crises in Asia (1997-1998) and Russia (1998), there was a strong market growth for two years. This growth was mainly driven by the "new economy" boom, especially with internet and technology companies. However, Swiss stock indexes were less affected by this boom. This is because they mostly include pharmaceutical, food, and financial companies.

The dot-com bubble burst in 2000, causing stock prices to fall worldwide, including in Switzerland. The SPI (Swiss Performance Index) entered a "bear market," meaning prices were falling. It lost more than 20% of its value by March 2001.

After a short recovery, the SPI started to fall again from May 2001. The 9/11 attacks made this decline even faster. The SPI reached its lowest point in March 2003, during the SARS epidemic and the Iraq war.

SIX Group

In May 2007, the SWX Group, SIS Group, and Telekurs Group announced they would merge. They formed a new holding company called Swiss Financial Market Services AG. The merger happened in 2008, and the new company was renamed SIX Group AG. SWX Swiss Exchange was renamed SIX Swiss Exchange in the same year.

Other Ventures

Eurex

From 1998 to 2012, SIX Swiss Exchange owned 15% of Eurex. Eurex is one of the world's largest exchanges for futures and derivatives. The other 85% was owned by its German partner, Deutsche Börse. In 2012, Deutsche Börse bought the remaining 15% from SIX Swiss Exchange, becoming the full owner.

SWX Europe

In 2001, SWX Swiss Exchange bought a trading platform called Tradepoint and renamed it Virt-x. This platform was used for trading 32 major Swiss stocks, known as blue-chip stocks. The goal was to create a larger European exchange and prevent trading of Swiss stocks from moving to the London Stock Exchange.

Virt-x was renamed SWX Europe in 2008. In 2009, SWX Europe stopped operating, and its trading activities were moved to SIX Swiss Exchange.

International Securities Exchange

On April 30, 2007, SWX Swiss Exchange and Deutsche Börse together bought a US option exchange called ISE. This purchase created one of the largest trading platforms for financial derivatives. The ISE cost $2.8 billion and kept its own structure and name.

Scoach

On January 1, 2007, SWX Swiss Exchange and Deutsche Börse started a joint venture called Scoach. This was an exchange specifically for structured products.

In February 2013, Scoach was split into two parts. Scoach Europa AG became fully owned by Deutsche Börse, and Scoach Schweiz AG became fully owned by SIX Swiss Exchange. Scoach Schweiz AG was later renamed SIX Structured Products in November 2013.

AsiaNext

In 2021, SIX Group created AsiaNext. This is a digital asset exchange for large financial companies. It was formed as a joint venture with SBI Digital Asset Holdings. In 2023, AsiaNext received a special license from the Monetary Authority of Singapore to operate as a recognized market.

Headquarters

The main offices of SIX Swiss Exchange moved to Selnaustrasse in 2002. In 2017, they moved again to the Hard Turm Park in Zürich-West.

Technology and Innovation

In 1962, Basel and Zürich exchanges were the first in the world to introduce exchange TV broadcasts. Banks started using computers, and exchanges followed later. In the 1980s, computers finally became common in exchanges.

On December 8, 1995, an advanced electronic system was introduced for trading foreign stocks. On August 2, 1996, this system was also used for Swiss stocks and options. Finally, on August 16, 1996, bonds were also traded electronically, and the traditional trading floor was closed.

In December 2020, SIX Swiss Exchange worked with the Bank for International Settlements and Swiss National Bank. They successfully tested a new digital currency system for central banks on a special digital platform.

Other Services

SIX Swiss Exchange is part of the SIX Group. This group provides many other important services for financial markets in Switzerland. The SIX Group has four main parts: Securities Services, Markets, Banking Services, and Financial Information.

These parts offer services like:

• Clearing (making sure trades are completed correctly).
• Acting as a central counterparty (a middleman in trades to reduce risk).
• Custody services (safekeeping financial assets).
• Providing market data (information about prices and trades).
• Managing share registry (records of who owns shares).
• Payment services.
• Running the real-time gross settlement (RTGS) system for the Swiss National Bank.

See also

In Spanish: SIX Swiss Exchange para niños