Overview of the Vancouver Stock Exchange (VAN/VSE)
The Vancouver Stock Exchange (VAN/VSE), once known for speculative listings, evolved into a specialty market for venture capital securities. In 1999, it merged with the Canadian Venture Exchange, becoming the TSX Venture Exchange, which is now a global leader in venture capital listings.
The Vancouver Stock Exchange, located in Vancouver, British Columbia, Canada, was incorporated in 1907. It was the third-largest stock exchange in Canada, following the Toronto Stock Exchange (TSX) and the Montreal Stock Exchange. Stocks listed on this exchange were identified by a ".V" following the ticker symbol.
Originally, the VAN was predominantly known for hosting small-capitalization mining, oil, and gas exploration stocks. However, as the 1990s approached, it transformed, becoming a specialized market for venture capital securities. This transition led to the VAN eventually falling under the umbrella of the TSX Venture Exchange, following a merger with the Canadian Venture Exchange in 1999.
While the Vancouver Stock Exchange was initially recognized as a hub for venture capital solutions, it earned a notorious reputation as the "scam capital of the world." At one point, the VAN listed approximately 2,300 stocks, with many of them being regarded as either abject failures or fraudulent ventures. Notably, the exchange highlighted the potential pitfalls of floating-point calculations, showcasing how errors in these calculations could result in significant inaccuracies in the index readings.
Despite its infamy, the VAN remained a low-volume exchange with speculative listings as its defining characteristics. It managed to survive the turbulence of the dotcom bubble and, in 1999, merged with the Alberta Stock Exchange and Bourse de Montreal to form the Canadian Venture Exchange, now recognized as the TSX Venture Exchange.
Transition to the TSX Venture Exchange
Following the merger, the trading floor of the Vancouver exchange became the focal point of the new venture division for a brief period. However, this arrangement was short-lived. In 2001, TMX Group, the parent company of the Toronto Stock Exchange, acquired the newly formed marketplace and promptly rebranded it. Presently, the TSX Venture Exchange is headquartered in Calgary, Alberta, with branch offices in other major Canadian cities. The transition to electronic trading eliminated the need for a physical trading floor.
The TSX Venture Exchange Today
Today, the TSX Venture Exchange stands as a significant player in global benchmarks and venture capital listings, despite its tumultuous history. The combined strength of the Toronto Stock Exchange and Venture Exchange has resulted in a staggering market capitalization of approximately $3.5 trillion. The venture division alone serves 1,713 companies with a collective market value of about $70 billion.
Trading on this exchange shares similarities with other major exchanges, including various order types, rules, regulations, and services to ensure smooth operation. Companies listed on the TSX Venture Exchange are subject to a range of fees, including initial application fees, registration costs, and monthly expenses.
The Vancouver Stock Exchange underwent a significant transformation from a speculative listing hub to a global leader in venture capital listings. Despite its notorious reputation as the "scam capital of the world," the VAN managed to survive and merge with the Canadian Venture Exchange to form the present-day TSX Venture Exchange. Today, the TSX Venture Exchange is a major player in global benchmarks and venture capital listings.