Paris Stock Exchange and the CAC index - History and Overview
The Paris Stock Exchange is now called Euronext Paris, its name since 2000 when the Paris Bourse merged with the Amsterdam and Brussels stock exchanges to create a global stock exchange system. The Paris Bourse and the Euronext Paris have been quick to ably adapt to changing technologies, going fully electronic by 1998. Let’s have a look at the history of this formidable stock market.
Stock trading has a long history in the geography of Paris. It has at various times been located on rue Quincampoix in the 4th arrondissement, rue Vivienne in the 2nd arrondisement, behind the Opera Garnier in the 9th arrondisement, and the Palais de la Bourse, also in the 2nd arrondisement. (As an idea of where these arrondissements, or districts are, start with the 1st arrondissement, right in the middle of Paris, then in a clockwise movement, spiral outward. The lower the arrondissement number, the closer to the center of the city. Paris has 20 total districts.)
The 19th century
After the mid 19th century, stock markets in Paris were operated by the Compagnie des Agents de Change, or what in English would be called stockbrokers. The 60 or so agents, directed by elected members of a stockbrokers’ syndical council, had to be French citizens, had to be nominated by a former agent (or his estate), had to be approved by the Finance Minister and appointed by the President. The agents were not allowed to trade for their own account or even as a counterpart to someone who wanted help buying or selling securities. They were strictly intermediaries, making the Paris Bourse an order-driven as opposed to a quote-driven market. The agents could receive a fixed commission for acting as intermediary. While this sounds very above board, a parallel market known as La Coulisse (a word that roughly translates as “behind the scenes”) operated alongside the official market, often making arrangements to favor some clients’ quotes. La Coulisse lasted until the mid 20th century.
A New Home
Until the late 1980s, the Parisian stock market operated with agents de change meeting on the trading floor of the Palais Brongniart on rue Vivienne. Napoleon first ordered the creation of this building in the commercial center of Paris. It was the final work of architect Alexandre-Theodore Brongniart who mostly designed private homes, though he did design a theater and other cultural buildings. The building today is the home of the Paris CAC-40, which is the French equivalent of the Dow Jones Industrial Average. Read more about CAC and the French Stock Exchange om the following article.