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London Stock Exchange

 

 
 

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The London Stock Exchange (LSE) is a stock exchange located in London, England. Founded in 1801, it is one of the largest stock exchanges in the world, with many overseas listings as well as UK companies.

Its current premises are situated in Paternoster Square close to St Paul's Cathedral.

The trade in shares in London began with the need to finance two voyages: The Muscovy Company's attempt to reach China via the White Sea north of Russia, and the East India Company voyage to India and the east. Unable to finance these costly journeys privately, the companies raised the money by selling shares to merchants, giving them a right to a portion of any profits eventually made.

The idea soon caught on (one of the earliest was the Earl of Bedford's scheme to drain the fens). It is estimated that by 1695 there were 140 joint-stock companies. The trade in shares was centered around the City's Change Alley in two coffee shops: Garraway's and Jonathan's. The broker John Castaing published the prices of stocks and commodities called The Course of the Exchange and other things in these coffee-shops. In 1697 a law was passed to 'restrain the number and ill-practice of brokers and stockjobbers' following a number of insider trading and market-rigging incidents. It required all brokers to be licensed and to take an oath promising to act lawfully.