STSM123060 - Financial markets: trading venues: LSE and AIM

The London Stock Exchange (LSE) is the world’s third largest stock exchange by market capitalisation of domestic securities listed, after the New York Stock Exchange and the Tokyo Stock Exchange. The LSE also permits non-UK companies to list on the exchange. In order for a company to be admitted to the LSE it must make an application for its shares to be admitted for trading on the ‘Official List’. This involves providing extensive data regarding the company’s financial status and trading history etc. Companies who are admitted for trading on the LSE as often referred as being in the ‘listed on the main market’. (See STSM071000 for more detailed information on the listing of shares).

The LSE restricts dealing to members only. Members usually have to pay a fee to join and must act in accordance with the rules of the exchange.

As well as the main market, the LSE also operates the Alternative Investment Market (AIM). AIM is designed for shares of emerging or smaller companies which cannot fulfil the requirements of the LSE for a full listing on the main market.