History of the Stock Exchange

Early manifestations of stock exchanges existed in the 13th and 14th centuries, first in the larger cities of northern Italy,
later - after the discovery of the sea route to India - in trading towns along the coasts of Holland and Flanders. In time,
the informal gatherings of merchants developed into actual stock exchanges with lively trading in goods. In Antwerp,
spot and futures transactions were concluded at a very early date, i.e. in the early 16th century. These transactions
were initially subject to unwritten trading customs; later on they were governed by formal rules issued by trade
associations. In the early 17th century, Antwerp was replaced by Amsterdam as the home of the most important
commodities exchange. When Amsterdam's exchange introduced trading in the shares of the Dutch East India
Company, it became the prototype for today's securities exchanges. From the first half of the 16th century, exchanges
were founded in all major trading cities, including London, Paris and the trading cities of Germany.
The old German term for stock exchange "bourse" is supposedly derived from "van der Beurse", an ancient patrician
family of Bruges. The family had a square named after it where, as early as the 14th century, money-changers and
merchants met to trade and to conclude money and exchange transactions. Another theory states that "bourse" is
derived from medieval "beurse", meaning "association".
The Swiss stock exchange looks back on 150 years of dynamism and excitement, highs and lows, change and
innovation.
The SIX Swiss Exchange was founded in 1993 as "Schweizer Brse/Bourse Suisse/Borsa Svizzera/Swiss Exchange".
It introduced electronic trading in 1995/1996. But its roots stretch much farther back into the past.
The earliest traces of a financial marketplace in what today is Switzerland date back to the 13th century and are found
in Basel; slightly newer traces are found in Geneva. The stock exchange has its origins in the 17th-century brokers
called Sensale. The first set of rules for mercantile brokers (Sensalenordnung) was introduced in St. Gallen in 1639.
Securities exchanges appeared in Switzerland from the mid-19th century. The first was founded in Geneva in 1850. By
the early 20th century, exchanges had been founded in Basel (1866), Lausanne and Zurich (1873), Bern (1884), St.
Gallen (1887) and Neuchtel (1905). The exchanges of Basel, Geneva and Zurich were subject to cantonal law.
Since the 1970s, there have been radical changes to Switzerland's stock-exchange structures. Turnover increases
required greater stock market capacities and hence new exchange buildings and technologies. The four smaller stock
exchanges discontinued floor trading, the three larger ones replaced it with an electronic trading system, and the Stock
Exchange Act replaced cantonal laws.

Market participants
Investors as a whole affect the activity that takes place at securities exchanges. As a member of this group, you
contribute by means of your investment decisions. Nevertheless, private investors are only considered indirect market
participants, because trading is performed by financial companies that are the actual market participants.
In Switzerland, admission to professional securities trading requires authorisation from the Swiss Financial Market
Supervisory Authority (FINMA) . The FINMA acts in accordance with the provisions of the Federal Law on Stock
Exchanges and Securities Trading (SESTA), which sets out the capital requirements, the expertise required of
employees and the disclosure obligations, among other things. In Switzerland, only banks and other financial
companies (stockbrokers, trading houses) are registered as securities dealers. In theory, natural persons could be
admitted as well. All Swiss and foreign financial institutions that engage in professional securities trading may apply for
participation in trading on the SIX Swiss Exchange.

Every day, millions of transactions take place in the securities market. Investors transmit orders to their principal bank,
which in turn places a majority of the collected orders in the stock market. Sometimes banks execute customer orders
with securities in their own portfolio. The investor pays the transaction costs in the form of fees and taxes.
The costs in Switzerland are as follows:
Typ

Description

Brokerage fee

Payment to the bank for executing buy and sell orders for all types of securities.
The amount of the brokerage fee depends on the provider's tariff model and is
partly determined by the volume, the price and the stock exchange where the
order is executed. The Cartel Commission banned standardised agreed-upon
brokerage fees with effect from end-1990.

Swiss stamp tax

A stamp tax of 0.075 per cent applies to each contracting party (0.15 per cent
total) on turnover in Swiss shares, regardless of the exchange and the security.
The tax authorities charge each contracting party a stamp tax of 0.15 per cent
(0.3 per cent total) on turnover in foreign shares. When the transaction is
executed, the counterparty takes on the other half. As of July 1, 2010, foreign (i.e.
non-Swiss) participants are no longer deemed to be securities traders in
accordance with stamp duty legislation and are thus exempt from stamp duty
(federal tax on transfer of securities).

Turnover fee incl. FINMA tax

The SIX Swiss Exchange charges a turnover fee to the involved parties. The fee
model takes account of the peculiarities of the different product segments. The
new tariff specifies different fees for poster and aggressor transactions. The tariffs
are explained in the following brochure: Trading fees.

Not only are the cost compositions and cost levels of orders variable, there are also many different types of orders that
you as an investor can place at the Exchange. For information on the different types of orders and order validity, please
see Trading at the SIX Swiss Exchange.

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