When: Sunday morning, 10:00 am
Where: The TASE Visitors’ Center which is located at the historical trading floors, at 54 Ahad Ha’am Street.
Who: Kobi Avramov
I took the bus in from Jerusalem on Sunday morning to join the rest of the class and I met up with them at the stock exchange. The first thing that hit me was as I approached the building the neighborhood gave off a very different feel than Wall Street. It seemed like a residential neighborhood. The cabbie from the bus station didn’t even know where it was and had to use a GPS to find the street co-ordinates I picked up off of Google Maps. It turns out that the neighborhood underwent a change in the past 70 years (no kidding) and a while back this was downtown.
Kobi Avramov spoke to us in the old trading room. The new trading room is inside a computer system; no one actually stands there in the room. The exchange is open Sunday through Thursday. A little while ago the Israelis had the idea to trade some of the big American stocks (e.g., IBM, GE) on Sunday but the Americans were not very pleased with the idea because “they wanted to be able to sleep at least on Sunday morning”! Within Israel Sunday is a regular business day, however a percentage of the TASE’s trades are transacted by foreigners who are not so likely to trade on Sunday and therefore the “Sunday effect” shows a 20% decrease in trading volume.
There are approximately 600 listed companies. The top 25 are called the TA-25 index and make up 60% of the trading. The top 100 are called (surprise…) the TA-100 index and make up 80% of the trading. 2 years ago they added a bio-med index for companies dealing with pharmaceuticals and the medical field, and this past April the Blue-tech 50 index was added. There are also various derivative markets available such as the shekel-dollar futures market. Amazingly, a full 140 companies listed on the exchange are hi-tech companies. (56! are in the bio-med industry.)
Over the past 5 years the TA-25 has fared better than its counterparts throughout the Western world. While most exchanges hovered slightly above or below the break-even line, the TA-25 saw an increase of 99%! However, part of this was due to the falling dollar, and now that the dollar has picked up slightly (today’s rate was 3.81 shekel per dollar) the TA-25 is not doing as well as it has over the past 5 years.
Kobi told us about how the Occupy Wall Street movement made its way to Tel Aviv along Rechov Rothschild. He spoke about some of the reforms the government put in place; however, the main problem has been left unsolved: high apartment prices.
I think it is noteworthy to point out that there was a bull in the corner covered by names of companies on the exchange, reminiscent of lower Broadway’s bull.