Amsterdam Stock Exchange (AEX) .AS Definition

Amsterdam Stock Exchange (AEX) .AS Definition

What is the Amsterdam Stock Exchange (AEX) .AS?

Founded in 1602, alongside the creation of the Dutch East India Company (VOC), the Amsterdam Stock Exchange is considered to be the oldest stock exchange in the world still in operation.

The need for a bank has increased with the prevalence of European trade and with the need to offer financiers a way to profit from this trade. The Dutch East India Company was one of the first companies to compete for exports of the spice and slave trade. It was a public limited company and would offer shares to investors who would finance the trips. The financiers needed a safe, regulated place to buy and sell stocks of these first global companies.

Before the AEX, many regions and cities had independent asset valuation and trade regulation systems that worked much like stock exchanges, but AEX was the first official stock exchange as we know it.

24

The number of companies listed on the AEX as of May 7, 2019.

The basics of the Amsterdam Stock Exchange (AEX) .AS

During its centuries-old history, the Amsterdam Stock Exchange has experienced several changes in ownership and governance structures.

Looking at recent history, in 1997 the Amsterdam Stock Exchange and the European Options Exchange (EOE) merged, and its benchmark was renamed AEX for “Amsterdam Exchange”.

In September 2000, the Amsterdam Stock Exchange merged with the Brussels Stock Exchange and the Paris Stock Exchange to form Euronext Amsterdam. Euronext is the largest cash equity market in Europe. For a while, it fell under the umbrella of NYSE Euronext, which operated several exchanges, including the New York Stock Exchange, the Liffe in London and NYSE Arca Options. In 2020, Euronext was spun off to become an independent entity again. In 2020, Euronext was the sixth combined exchange by market capitalization.

The AEX is one of the main indices of Euronext.

AEX stock market indices

The three main Euronext Amsterdam stock market indices are the leading AEX, the mid-cap AMX and the small-cap AScX. By far, the most traded and influential index is the AEX, which started in 1983 and is made up of more than 20 of the most frequently traded Dutch companies trading on Euronext Amsterdam. These companies include international companies such as Unilever, ING Group, Philips and Royal Dutch Shell. It is one of the main national indices of the Euronext stock exchange group alongside BEL 20 in Brussels, CAC 40 in Paris and DAX in Germany.

Key points to remember

  • The Amsterdam Stock Exchange, founded in 1602, is considered one of the oldest stock exchanges in the world.
  • AEX merged with the Brussels Stock Exchange and the Paris Stock Exchange to form Euronext Amsterdam in 2000.
  • Its three major stock market indices are the leading AEX, the mid-cap AMX and the small-cap AScX.
  • More than 20 of the most frequently traded Dutch companies trade on the stock exchange.

Example from the real world

A review of the composition of the AEX index is performed quarterly, with a comprehensive review in March and interim reviews in June, September and December. Any change to the index following these examinations takes effect on the third Friday of the month. Before 2008, index changes were made only once a year in March.

The AEX is an index weighted according to market capitalization, the initial weights of each company being capped at 15%. The index weights are calculated based on the closing prices of the companies concerned on March 1. During quarterly reviews, the weightings after adjustment are left as close as possible to those of the previous day and are not cropped.

Leave a Comment

Your email address will not be published. Required fields are marked *