Tel Aviv Stock Exchange

The display in the lobby of the Tel Aviv Stock Exchange

The precursor to the TASE was the Exchange Bureau for Securities, founded in 1935 by the Anglo-Palestine Bank (which became Bank Leumi). With the formation of the State of Israel in 1948, a pressing need arose to formalize trade in securities. In September 1953, a number of banks and brokerages joined forces to establish the Tel Aviv Stock Exchange, which began operations in December 1953.[3] Ten years later, a group of members of the Exchange created the TASE Clearing House. The Clearing House also acted as the central security depository in Israel. In 1968, the Knesset passed the Securities Law (1968), which established the Israel Securities Authority, which became the modern regulatory framework for the TASE and its operations.[6]

TASE moved to 54 Ahad Ha’am Street, Tel Aviv in 1983, and moved again in 2014 to new premises at 2 Ahuzat Bayit Street, Tel Aviv. The exchange completed its conversion to electronic trading in 1999. In 2006, TASE bought all the shares of TASE Clearing House from TASE members, to make it a fully owned subsidiary.[7]

The trading week is five days a week, Sunday to Thursday. In 2009, the trading hours were set at 9:30 am–4:30 pm. Since June 2013, trading hours were extended by an hour to bring trading hours closer to those of the European market,[8] becoming 9:30 am–4:30 pm on Sundays and 9:30 am–5:30 pm Monday to Thursday Israel Standard Time, which is two hours ahead of UTC (UTC+02:00).

Yossi Beinart was appointed TASE CEO in January 2014 and was a Director at the Tel-Aviv Stock Exchange Clearing House Ltd and on the MAOF Clearing House Ltd board. Beinart died in August 2017, and was succeeded by Itai Ben-Zeev. Amnon Neubach has been the Chairman of the TASE Board since April 2014.

In 1993 TASE had the third largest number of IPOs of all the world stock exchanges.[9]

In 2005, non-Israeli investment in TASE reached an all-time high of NIS 2 billion, while the TA-25 increased 34%. By the end of the year foreign investment banks UBS, Deutsche Bank, and HSBC had become members of TASE.[10]

In 2007, trading averaged $500 million a day, a 55% increase over the previous year. The number of exchange-traded funds (ETFs) grew to 240. The Tel Bond-20 index was also launched that year.[11] The TA-25 rose 175% in the period 2004–07.[12]

In May 2008 Northern Trust started the first US exchange-traded fund on the NYSE based on TASE's benchmark, the TA-25 Index.[13]

Performance

A broker giving an order to purchase stocks, 1989

As of May 25, 2010, TASE's largest stocks by market capitalization were Teva Pharmaceutical Industries ($51.5 billion), Israel Chemicals ($14.3bn), Bank Leumi ($6.1bn), and Bezeq ($6.0bn). Daily turnover of shares and convertibles in 2009 was US$432 million, $1,035M of bonds and exchange-traded notes (ETNs), $163M of T-bills, and 252,000 options and futures contracts. Total market capitalization at the end of 2009 was $189bn shares and convertibles, $174bn government and corporate bonds, and $23bn T-bills, a total of $386bn. On April 25, 2010, TASE's benchmark TA-25 index reached a record high of 1,239 points.

For the decade ending 12 February 2012, the TA–25 index topped the Bloomberg Riskless Return Ranking list, outperforming 23 other developed-nation benchmark indexes when adjusting for volatility.[14]

CEO Ester Levanon resigned on 18 July 2013, effective 31 December 2013. A week later, on 25 July 2013, Chairman Saul Bronfeld resigned. According to Bloomberg, the executives’ decisions follow a drop in trading volume and the bourse's failed bid to join MSCI Inc.’s Europe Index. Bronfeld, who served as chairman since 2006, cited the “hostile control” by the Israel Securities Authority and the regulator's interference in the executive management of the bourse as the main reasons for his resignation.

In 1983, TASE moved to 54 Ahad Ha'am Street, Tel Aviv, where it remained for 31 years, until it moved in 2014 to its current location at 2 Ahuzat Bayit Street, Tel Aviv.

The modern building covers an area of 22,600 square meters and has 14 floors. It is optimized for computer trading. Its computer systems are located in an underground bunker in case of emergencies, in which there is space for emergency personnel.[21] Architectural critic Keshet Rosenblum praised the new building, due to its appropriate design, restraint in its form and public access. The lobby of the building is public and there is cafe and stock exchange museum.[22]

The Exchange offers four programs under which companies can list on the exchange: three programs for normal operating companies, and an additional venture program for development-stage technology companies. In addition, the TASE has a program for the listing of Limited Partnership Units.

Trading in shares takes place Sunday through Thursday between 9:00 a.m. and 5:30 p.m. (4:30 p.m. on Sundays) local time (GMT+2) on a computerized trading system. Bonds, Treasury bills and Derivatives are traded between 9:30 a.m. and 5:30 p.m. (4:30 p.m. on Sundays)[23][24] Dual listing is permitted, and many larger Israeli companies are dually listed on the TASE and one or more foreign markets, usually the New York Stock Exchange or NASDAQ, but also the American Stock Exchange and London Stock Exchange.[25]

During regular trading hours the TASE can process orders of four varieties: LMT, MKT, FOK, and IOC.[26]

TASE links to the U.S. markets with a direct link to DTC, a subsidiary of the Depository Trust & Clearing Corporation, which facilitates the trading of dually listed securities.

The ETF that tracks the performance of Israel's overall market is the iShares MSCI Israel Capped Investable Market Index Fund, or EIS (NYSE Arca: EIS).[27]

The major stock market indices of the TASE include:

• TA-35 Index – TASE's flagship index, listing TASE's 35 largest stocks by market cap. Also called the Ma'of.
• TA-125 Index – TASE's 125 largest stocks
• TA-90 – Stocks on TA-125 which are not included in TA-35
• Mid-Cap 50 – The largest 50 shares which are not included in TA-100 Index (replaced the Yeter-30)
• Mid Cap TA – All other TASE's stocks which are not included in TA-100 Index
• TA Composite - The index includes all the shares traded on the exchange
• TA BlueTech Index - The index is composed of all shares that are part of the TA-Technology Index and the TA-Biomed index. The Index replaced the Tel-Tech Index that ceased being published in April 2011.
• TA Tech-Elite - The index is composed of all shares of companies that are part of the TA BlueTech Index and have a market value of at least 400 million NIS, or 200 million NIS for recently established companies.
• TA-Technology Index – The index is composed of all technology shares on TASE
• TA-Biomed Index - The index composed of all the Biomed sector shares on TASE
• TA-Oil & Gas Index is composed of all shares included in oil & gas exploration sector shares on TASE
• TA Real-Estate 15 – TASE's 15 largest real-estate sector stocks
• TA Finance 15 – TASE's 15 largest Finance sector stocks
• Tel-Div 20 – Index of the 20 issues listed on the TA-100 Index with the highest annual dividend yield.
• Maala – socially responsible investing index
• Tel-Bond 20 – consists of the 20 corporate bonds, fixed-interest and CPI-linked, with the highest market cap among all the bonds traded on the TASE.

These and other indices are explained on the TASE website indices section.[28]

The TASE is regulated by the Securities Law (1968), and falls under the direct supervision of the Israel Securities Authority.[29]

Two clearing houses operate at the TASE as subsidiaries:

• The TASE Clearing House was established in 1966. It clears all securities transactions executed on and off the stock exchange and carries out income payments on behalf of companies. The TASE Clearing House also operates a Global Clearing, Settlement, and Custody Services unit in collaboration with Citigroup.
• The Derivatives Clearing House was established in 1993 with the opening of the TASE derivatives market. It is responsible for clearing options and futures traded on the TASE.

• Tel Aviv Stock Exchange in English