Tokyo Stock Exchange facts for kids
| Tokyo Stock Exchange | |
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Quick facts for kids 東京証券取引所 |
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| Tokyo Stock Exchange Main Building (1988).jpg | |
| Type | Stock exchange |
| Location | Tokyo, Japan |
| Coordinates | 35°40′53″N 139°46′40″E / 35.68139°N 139.77778°E |
| Founded | May 15, 1878 (as Tokyo Kabushiki Torihikijo) May 16, 1949 (as Tokyo Stock Exchange) |
| Owner | Japan Exchange Group |
| Key people |
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| Currency | Japanese yen |
| No. of listings | 3,899 (21 Aug. 2023) |
| MarketCap | US$5.904 trillion (Nov 2023) |
| Indexes | Nikkei 225 TOPIX |
The Tokyo Stock Exchange (TSE), also known as Tosho or TYO, is a very important place in Tokyo, Japan. It is where people buy and sell shares of companies. When you buy a share, you own a tiny part of that company.
The Tokyo Stock Exchange is part of a bigger company called the Japan Exchange Group (JPX). JPX was created in 2013 when the Tokyo Stock Exchange Group joined with the Osaka Securities Exchange. This made a larger, stronger group for trading in Japan.
Contents
What is the Tokyo Stock Exchange?
The TSE is set up as a company called a kabushiki gaisha, which is like a joint-stock company in other countries. It has leaders who help run it. The main office is in Nihonbashi-Kabutocho, Chūō, Tokyo. This area is a big financial district, meaning it's a hub for banks and money-related businesses in Japan.
The TSE uses special numbers to track how well the market is doing. These are called indices. The most famous ones are the Nikkei 225 and the TOPIX.
- The Nikkei 225 tracks 225 big companies chosen by a Japanese business newspaper.
- The TOPIX looks at the share prices of many companies listed on the exchange.
Many companies that help people buy and sell shares, called securities companies, work with the TSE.
The Press Club
The TSE has a special press club called the Kabuto Club. This is where reporters from news companies like Nihon Keizai Shimbun and Bloomberg LP meet. They gather on the third floor of the TSE building to get the latest news about companies and the stock market. They are often busiest in April and May, when companies share their yearly financial reports.
Trading Hours
The Tokyo Stock Exchange is open for trading from 9:00 a.m. to 11:30 a.m. and then again from 12:30 p.m. to 3:00 p.m. It is open on weekdays but closed on Saturdays, Sundays, and public holidays in Japan.
How the Stock Market is Organized
Old Market Sections (until April 2022)
Before April 4, 2022, companies on the Tokyo Stock Exchange were grouped into different sections. This helped people understand the size and type of company they were investing in.
- The First Section was for very large and well-known companies.
- The Second Section was for medium-sized companies.
- JASDAQ and Mothers were for newer, growing companies.
- The TOKYO PRO Market was for smaller companies, often those that were just starting out.
As of March 31, 2022, there were 3,821 companies listed on the Tokyo Stock Exchange.
| Business size | Market names | Total | (Overseas
companies) |
|
|---|---|---|---|---|
| Large | Main Market
(本則市場) |
First Section (市場第一部) | 2,176 | (1) |
| Mid-sized | Second Section (市場第二部) | 475 | (1) | |
| Emerging | Mothers (マザーズ) | 432 | (3) | |
| JASDAQ | Standard (スタンダード) | 652 | (1) | |
| Growth (グロース) | 34 | (0) | ||
| Small | TOKYO PRO Market | 52 | (0) | |
| Total | 3,821 | (6) | ||
New Market Sections (since April 2022)
On April 4, 2022, the TSE changed how it groups companies. Now there are three main market sections: Prime, Standard, and Growth. These new groups are based on things like how easily shares can be bought and sold (called market liquidity) and how well companies are managed (called corporate governance).
Most large companies moved to the Prime market. Medium-sized companies and some smaller ones moved to the Standard market. Many new and growing companies moved to the Growth market.
As of August 21, 2023, there were 3,899 companies listed on the Tokyo Stock Exchange.
| Business size | Market names | Total | (Overseas companies) |
|---|---|---|---|
| Large | Prime Market (プライム市場) | 1,834 | (1) |
| Mid-sized | Standard Market (スタンダード市場) | 1,440 | (2) |
| Emerging | Growth Market (グロース市場) | 546 | (3) |
| Small | TOKYO PRO Market | 79 | (0) |
| Total | 3,899 | (6) | |
History of the TSE
Early Years
The Tokyo Stock Exchange first opened on May 15, 1878. It was called the Tokyo Kabushiki Torihikijo back then. Trading officially started on June 1, 1878.
In 1943, during World War II, the exchange joined with other stock exchanges in Japan to form one big Japanese Stock Exchange. However, this combined exchange closed down on August 1, 1945, just before the end of the war.
After the War
The Tokyo Stock Exchange reopened with its current name on May 16, 1949.
From 1983 to 1990, the TSE grew very quickly. For a while in 1990, it was the largest stock market in the world! But then its value dropped, and it became one of the fourth largest exchanges.
The current TSE building opened on May 23, 1988. Before that, the original building from 1931 was used. In 1999, the trading floor where people used to shout orders was closed. This was because the exchange switched to electronic trading, meaning all buying and selling happens on computers now. A new electronic trading facility called TSE Arrows opened in 2000.
In 2001, the TSE changed its structure to become a "stock company," like many other businesses.
Technology Challenges
The Tokyo Stock Exchange has faced some technology problems over the years.
- On November 1, 2005, the exchange could only operate for 90 minutes because of issues with a new computer system. This was a big problem for trading.
- In December 2001, a trader made a huge mistake when selling shares of a company called Dentsu. They meant to sell 16 shares for ¥600,000 each, but accidentally sold 610,000 shares for ¥6 each. This mistake cost the bank a lot of money.
- Another similar mistake happened on December 8, 2005, with shares of J-Com. An employee accidentally tried to sell 600,000 shares for ¥1 each instead of 1 share for ¥600,000. The exchange's system did not stop the error right away, leading to a large financial loss. After this, the head of the TSE and other leaders resigned.
- On January 17, 2006, the market dropped quickly after a company called livedoor faced problems. The next day, the TSE had to stop trading early because the computer system couldn't handle all the buying and selling happening. This event was called the "livedoor shock." The exchange quickly improved its system to handle more trades.
- On October 1, 2020, for the first time ever, the Tokyo Stock Exchange had to stop all trading for an entire day. This was due to a major technical problem with its system for sharing market information. Trading returned to normal the next day.
Images for kids
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Old Tokyo Stock Exchange building (c. 1960)
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Tokyo Stock Exchange (1950)
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The annular electric bulletin board on the market center (2018)
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Main room of the Tokyo Stock Exchange (2018)
See also
In Spanish: Bolsa de Tokio para niños
- List of East Asian stock exchanges
- List of stock exchanges
