Invest in South Africa via the JSE
The JSE Limited is the 18th largest exchange in the world by market capitalisation (some R3.3-trillion as of September 2005).
With approximately 400 listed companies and a market liquidity of 31.2% (September 2005), South Africa's exchange is only marginally smaller than Stockholm's and larger than no fewer than nine exchanges officially classified as "developed".
After 110 years in business, the JSE strives to improve on its traditional offering to capital providers and seekers in offering secure, efficient primary and secondary capital markets across a diverse range of instruments, supported by cost-effective services.
Meeting the needs of issuers and investors is the JSE's game in South Africa's dynamic, fast-growing economy.
The JSE for issuers
The JSE Limited gives companies the opportunity to raise capital in the comfort of a highly regarded and sophisticated regulatory environment with no financial impediments to access by foreign investors.
In its efforts to attract only quality companies, the JSE has ensured that it meets or exceeds the standards of other world-class exchanges. All shareholders enjoy fair and equal treatment in respect of their securities, and world-class systems are used to provide trading and settlement services.
Totally electronic settlement system
The JSE's trading system is a totally electronic, anonymous central order book with market depth and true price transparency.
The electronic rolling contractual T+5 settlement system, STRATE, is rated among the top five in the world. The JSE is regarded as a global leader in real-time market surveillance systems providing access to client-level details.
Reporting standards, corporate governance
The JSE has also taken a
global lead in reporting standards, disclosure and corporate governance.
As of January 2005, all companies listed on the JSE must report according to the new widely accepted International Financial Reporting Standards.
The JSE has harmonised its listing requirements, disclosure rules and other continuing obligations with those of the London Stock Exchange.
This commitment is backed by a robust corporate governance setting based on the recommendations of the local King 2 report, the fundamentals of which are incorporated into the JSE's listings requirements.
Where transparency is regarded as essential, the JSE's SENS system electronically transmits approved company announcements and price-sensitive information to the major wire services in real time.
Socially Responsible Investment Index
The JSE also encourages its listed companies to balance the need to make returns for shareholders with wider obligations to society, the economy and the
environment.
The JSE launched the triple bottom line based Socially Responsible Investment Index in 2004, the first such index in an emerging market.
The index acts as a benchmark to South African companies and allows investors access to a unique criteria-based screen that monitors the behaviour of the companies in which they invest.
The JSE for investors
World-class technology, world-class surveillance and world-class settlement in an emerging market? The JSE offers investors a truly First World trading environment.
The market is freely accessible to the international investor, offering freedom from exchange control, no withholding taxes, no foreign ownership limits, and no foreign registration process.
The local Rand (ZAR) has a unified, free-floating exchange rate backed by a liquid and deep sovereign bond market with turnover of 10 times GDP.
Under one roof, the JSE offers investors the choice of four markets:
The JSE's equities market, including Exchange Traded Funds and warrants, makes issuer stocks available from the Main Board or the budding Alternative Exchange (AltX), a board especially set up for quality small to medium-sized companies.
Yield-X, the JSE's interest rate market, was launched in 2005 to trade both spot and derivative interest rate products on one platform. The innovative products have been adapted to the South African market, trading across the yield curve. Yield-X makes it simpler, cheaper and more transparent for investors to trade and has been met enthusiastically, though conservatively, by the market.
The JSE's active financial derivatives market is thriving. Its list of products is impressive and also boasts futures on tradeable indices, including the flagship index of the biggest 40 stocks listed on the exchange. The market has received a no action letter from the CFTC in the United States, enabling US institutions to trade it freely and representing a valuable endorsement of the product. The JSE's flourishing Single Stock Futures market, now the fourth largest in the world, trades 135 futures and comprises 73% of the derivatives traded on the exchange.
The JSE's agricultural products market is a transparent electronic market providing price risk management through futures and options to an industry which has only recently been deregulated. Presently trading through the exchange are maize, wheat, sunflower seeds and soyabean futures and options contracts.
SouthAfrica.info reporter
