Understanding the Amsterdam Stock Exchange (AEX) .AS
Let me take you back to 1602, when the Amsterdam Stock Exchange was founded alongside the Dutch East India Company (VOC)—that's right, it's considered the oldest stock exchange still in operation today.
As European trade boomed, so did the need for a bank to help financiers profit from it. The Dutch East India Company, one of the first joint-stock companies, issued shares to fund voyages in the spice and slave trades. Investors needed a secure, regulated spot to buy and sell these shares, and that's where the AEX came in.
Before this, various regions had their own systems for asset valuation and trade, but the AEX was the first official stock exchange as we recognize it now. As of May 7, 2019, there were 24 companies listed on the AEX.
The Basics of the Amsterdam Stock Exchange (AEX) .AS
Over centuries, the Amsterdam Stock Exchange has seen multiple ownership shifts and governance changes. In recent times, it merged with the European Options Exchange (EOE) in 1997, renaming its blue-chip index to AEX for 'Amsterdam Exchange.'
Then, in September 2000, it joined forces with the Brussels and Paris Stock Exchanges to form Euronext Amsterdam, which is Europe's largest cash equities market. For a while, it was under NYSE Euronext, running exchanges like the New York Stock Exchange, London's Liffe, and NYSE Arca Options. By 2014, Euronext spun off as an independent entity, and as of 2017, it ranked as the sixth largest stock exchange by market cap.
Importantly, the AEX stands as one of Euronext's primary indexes.
Equity Indexes of the AEX
Euronext Amsterdam operates three broad equity indexes: the blue-chip AEX, the mid-cap AMX, and the small-cap AScX. The AEX is by far the most traded and influential, starting in 1983 and including more than 20 of the most frequently traded Dutch companies on Euronext Amsterdam.
These include global players like Unilever, ING Group, Philips, and Royal Dutch Shell. It ranks among Euronext's leading national indices, alongside Brussels' BEL 20, Paris's CAC 40, and Germany's DAX.
Key Takeaways
- The Amsterdam Stock Exchange, founded in 1602, is one of the world's oldest stock exchanges.
- In 2000, AEX merged with Brussels and Paris to form Euronext Amsterdam.
- It has three broad equity indexes: blue-chip AEX, mid-cap AMX, and small-cap AScX.
- More than 20 of the most frequently traded Dutch companies are on the exchange.
Real World Example of the AEX
The AEX index gets reviewed quarterly, with a full review in March and interim ones in June, September, and December. Any changes take effect on the third Friday of the month. Before 2008, these changes happened only once a year in March.
It's a market capitalization-weighted index, where no single company's initial weighting exceeds 15%. Weights are based on closing prices from March 1, and during quarterly reviews, they're adjusted to stay close to the previous day's without re-capping.
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