Pakistan’s Stock Exchange (PSX) is a stock exchange with trading floors in Karachi, Islamabad, and Lahore. There are around 400 brokerage firms and 21 asset management businesses that are members of the PSX. The Pakistan Stock Exchange, the country’s principal capital market institution, is well aware of its duty as a front-line regulator. Stakeholders benefited from it since it successfully ran its trading session, making it easier for investors, TREC holders, and market players. PSX is a computerized marketplace where investors can purchase and sell listed firms’ common stocks and other securities in a safe, orderly, liquid, and efficient manner.
On September 18, 1947, Pakistan Stock Exchange Limited (PSX) (previously Karachi Stock Exchange (Guarantee) Limited (KSE)) was founded. On March 10, 1949, it became a corporation. With a total paid-up capital of 37 million rupees, only five businesses were initially listed. The KSE 50 index was the first index developed, and it was based on fifty companies. Trading was usually done on an open call system. The computer trading system called the Karachi Automated Trading System (KATS) was launched in 2002 with a trading capacity of 1.0 million per day and the ability to provide connectivity to an unlimited number of users.
In October 1970, under the Securities and Exchange Ordinance of 1969 by the Government of Pakistan, a second stock was established in Lahore in response to the needs of the capital city of the province of Punjab. It originally had 83 members and was housed in a rented building in a densely populated area of Bank Square in Lahore. LSE was the first stock exchange in Pakistan to use the internet.
And another stock exchange known as the Islamabad Stock Exchange was established in Islamabad, the capital of Pakistan on October 25, 1989 with the main aim of establishing trading and residential infrastructure, information system, skilled resources, accessibility and orderly. The needs of undeveloped areas in the northern parts of Pakistan. It was licensed as a stock exchange on January 7, 1992.
All of these exchanges had different management, trading links, indicators, listing methods etc. All of these exchanges had previously functioned as nonprofits with a consensus structure in which their members were entitled to trade and patents. This structure has naturally created a conflict of interest and appears to jeopardize the interests of investors. Therefore, the Stock Exchanges (Corporatization, Demutualization & Integration) Act, 2012 (known as the “Demutualization Act”) was promulgated by the Government. As a result these three exchanges were merged to form a new joint venture called Pakistan Stock Exchange Limited (PSX) which became operational on January 11, 2016 under this new heading.
As provided for under the above-mentioned Demutualization Act, Members have now ceased to be members of the PSX and have been issued with Commercial Copyright Certificates (“TRECs”) and PSX ownership shares, thereby separating trade rights and patents. While TRECs represent trading rights, PSX shares represent ownership. Now, TREC executives do not need to be PSX shareholders or PSX shareholders are required to be TREC PSX shareholders.
As envisaged under the provisions of the Consumer Act, regulatory functions are separated from the commercial functions of PSX, so that regulatory functions are not compromised in achieving the commercial purpose of monetization. In addition, under the provisions of this Act, after the reduction of the law, the number of persons representing TREC owners on the PSX Board shall not be plural and the Act also considers the division of shares of TREC owners held in their restricted accounts to investors and public / financial institutions. Within a certain time limit.
The Karachi branch of the Pakistan Stock Exchange is located on Stock Exchange Road, in the heart of the Karachi business district. This area is known as the Stock Exchange Building.