NZX, the New Zealand Stock Exchange, operates three markets with plans for a fourth. The main exchange, NZSX, covers over 200 companies, while NZAX is designed for smaller companies and NZDX deals in debt securities. NZX also has subsidiaries and interests in the agricultural finance sector.
The New Zealand Stock Exchange is the country’s national stock exchange. Its legal name is New Zealand Exchange Limited and it trades as NZX. The exchange operates three markets with a new one under development.
While New Zealand’s stock markets date back to the 1870s, the country did not have a single national stock exchange until 1974. At this time, the various regional exchanges were merged to form the New Zealand Stock Exchange. This name changed to NZX in 2003, shortly after the exchange demutualized. This meant that it was no longer wholly owned by its members, but was a publicly traded company in its own right.
There are three main markets on the New Zealand Stock Exchange. The New Zealand stock market, of NZSX, once known as the Main Board, is the main exchange. Covers more than 200 companies. As with many stock markets, it has one main index, the NZSX 50, which tracks the 50 largest companies by market capitalization.
The New Zealand Alternative Market, or NZAX, is designed for companies where listing on the main exchange is not ideal. This includes smaller companies that are growing rapidly, those for which the costs of listing on the major exchange would be prohibitive, and organizations with an unconventional structure, such as cooperatives. NZAX offers a Sponsor scheme where banks can help companies with costs and administration of listing on the market.
The New Zealand Debt Market, or NZDX, deals in debt securities. These include company bonds, government stocks, and Treasury bills. As of 2010, there were plans for a fourth market for the New Zealand Stock Exchange. Entitled NZFOX, it was slated to enable the trading of futures and options contracts based on securities traded on other markets.
The New Zealand Stock Exchange also has several subsidiaries. He is the outright owner of Smartshares, which offers investment funds, and FundSource, which researches fund performance. It has a partial interest in Link Market Services, which runs a stock registry, and Apello Services, which offers fund management administration services.
NZX also has a variety of interests in the agricultural finance sector. These include Agrifax, which offers price and information services, Dairyweek, which is a weekly news summary service for the dairy industry, and Newsroom, which publishes many agricultural magazines. NZX is also partnering with several banks in a bid to launch a rival electronic communications service to the existing setup in the Australian financial markets.
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