The Caracas Stock Exchange or Bolsa de Valores de Caracas (BVC) is a

stock exchange A stock exchange, securities exchange, or bourse is an exchange where stockbrokers and traders can buy and sell securities, such as shares of stock, bonds and other financial instruments. Stock exchanges may also provide facilities for t ...

located in

Caracas Caracas (, ), officially Santiago de León de Caracas, abbreviated as CCS, is the capital and largest city of Venezuela, and the center of the Metropolitan Region of Caracas (or Greater Caracas). Caracas is located along the Guaire River in th ...

Venezuela Venezuela (; ), officially the Bolivarian Republic of Venezuela ( es, link=no, República Bolivariana de Venezuela), is a country on the northern coast of South America, consisting of a continental landmass and many islands and islets in th ...

. Established in 1947, BVC merged with a competitor in 1974.

Operational and Legal Structure

BVC is a private exchange, providing operations for the purchase and authorized sale of

securities A security is a tradable financial asset. The term commonly refers to any form of financial instrument, but its legal definition varies by jurisdiction. In some countries and languages people commonly use the term "security" to refer to any for ...

according to the Capital Marketing Laws of Venezuela. It is member of the Executive Committee of the Latin American Federation of Stock markets. At the exchange, companies emit by procedures authorized by the regulating authorities, instruments of

fixed income Fixed income refers to any type of investment under which the borrower or issuer is obliged to make payments of a fixed amount on a fixed schedule. For example, the borrower may have to pay interest at a fixed rate once a year and repay the prin ...

and securities (''renta fija y de renta variable'') with the purpose of securing

capital Capital may refer to: Common uses * Capital city, a municipality of primary status ** List of national capital cities * Capital letter, an upper-case letter Economics and social sciences * Capital (economics), the durable produced goods used fo ...

from public

investors An investor is a person who allocates financial capital with the expectation of a future return (profit) or to gain an advantage (interest). Through this allocated capital most of the time the investor purchases some species of property. Type ...

. BVC is also used as a location for trading in

Bond Bond or bonds may refer to: Common meanings * Bond (finance), a type of debt security * Bail bond, a commercial third-party guarantor of surety bonds in the United States * Chemical bond, the attraction of atoms, ions or molecules to form chemical ...

s and other

debt Debt is an obligation that requires one party, the debtor, to pay money or other agreed-upon value to another party, the creditor. Debt is a deferred payment, or series of payments, which differentiates it from an immediate purchase. The ...

instruments. The legal structure prevailing in the Venezuelan capital market are the Securities

Marketing Marketing is the process of exploring, creating, and delivering value to meet the needs of a target market in terms of goods and services; potentially including selection of a target audience; selection of certain attributes or themes to emph ...

Law (''la Ley de Mercado de Capitales'', enacted in 1975 and amended in 1998), Transaction Law (''Ley de Caja de Valores''), the Statutory Law of Public Credit (''Ley Orgánica de Crédito Público''), the Law of Organizations of Collective Investment and the norms dictated by the National Exchange Commission (''Comisión Nacional de Valores'', or CNV). Exchange activities are regulated and supervised by the National Exchange Commission, a public entity assigned to the

Ministry of Finance A ministry of finance is a part of the government in most countries that is responsible for matters related to the finance. Lists of current ministries of finance Named "Ministry" * Ministry of Finance (Afghanistan) * Ministry of Finance and Ec ...

, that authorizes internal procedures and regulations.

Board of Directors

The

Board of Directors A board of directors (commonly referred simply as the board) is an executive committee that jointly supervises the activities of an organization, which can be either a for-profit or a nonprofit organization such as a business, nonprofit orga ...

of the Caracas Stock Exchange is presided over by Víctor Julio Flores. Additional members include Santiago Fernández Castro, Marcel Apeloig, Omar Delgado, José Gregorio Castro, Gabriel Osío, Jesús Tadeo Prato, Luis Oberto, Carlos Fernández and Mario Dickson, as well as by advisers Luis Andrés Guerrero and Rubén Manzur.

History and Performance

The origins of the Venezuelan stock market can be traced to the end of the

colonial Colonial or The Colonial may refer to: * Colonial, of, relating to, or characteristic of a colony or colony (biology) Architecture * American colonial architecture * French Colonial * Spanish Colonial architecture Automobiles * Colonial (1920 au ...

era, when in 1805 Don Bruno Abasolo and Don Fernando Key Muñoz founded the ''Casa de Bolsa y Recreación de los Comerciantes y Labradores'' in Caracas. The exchange was officially founded on January 21, 1947 and inaugurated its first trading session on April 21 of the same year, after previously trading stocks over the counter. On May 6, 1976, the assembly of shareholders decided to change the denomination of the institution to ''Bolsa de Valores de Caracas C.A.'', and initiated a new operating structure composed of 43

shareholders A shareholder (in the United States often referred to as stockholder) of a corporation is an individual or legal entity (such as another corporation, a body politic, a trust or partnership) that is registered by the corporation as the legal ...

, or ''puestos de bolsa'', an amount that would be increased to 63 members in 1995.

Performance

In 1990, with an increase of 602%, the market was the second-best performing that year (after Poland). In April 2007, 60 companies were listed on the BVC, with less than half being traded regularly. BVC experienced a severe decline in traded volumes since the mid-1990s as a result of a declining

economy An economy is an area of the production, distribution and trade, as well as consumption of goods and services. In general, it is defined as a social domain that emphasize the practices, discourses, and material expressions associated with th ...

, the migration of stocks to the U.S. markets in the form of

American Depositary Receipt An American depositary receipt (ADR, and sometimes spelled ''depository'') is a negotiable security that represents securities of a foreign company and allows that company's shares to trade in the U.S. financial markets. Shares of many non-U.S ...

s (ADRs), corporate takeovers with a concomitant reduction in the number of shares available for trade and an increasing country risk that has frightened investors, particularly foreign investors. Daily trading volume decreased from the equivalent of $25 to $30 million in 1997 to less than $1 million by 2000. The BVC survived during this period thanks to a growing trade of government debt securities. Stock prices, measured by the ''Indice Bursátil Caracas'', were also depressed during the 1990s and have yet to recover to the highest ever levels experienced in 1991. According to the

International Finance Corporation The International Finance Corporation (IFC) is an international financial institution that offers investment, advisory, and asset-management services to encourage private-sector development in less developed countries. The IFC is a member of ...

, the market value of the BVC was $7 billion in 2000, or just about 6 percent of GDP.Urbi Garay & Maximiliano Gonzalez, ''CEO and Director Turnover in Venezuela'', Inter-American Development Bank In 2005 total transactions on the BVC totaled USD$438 million.

Electronic Exchange

BVC has been completely electronic since February 1992, when a modern electronic trading system developed by the Vancouver Stock Exchange entered operations. On July 2, 1999 another technological change was made when the SIBE (''Sistema Integrado Bursátil Electrónico''), electronic trading system was officially incorporated into the Caracas Stock Exchange.

Notes

External links

Official Page
{{Authority control Stock exchanges in South America Economy of Venezuela Financial services companies of Venezuela Caracas Financial services companies established in 1947 1947 establishments in Venezuela Companies listed on the Caracas Stock Exchange