A type of security that signifies ownership in a company and represents a claim on part of the company’s assets and earnings.
A bond is a security issued by a borrower, wherein the borrower promises to pay to the lender (i.e. the person who bought the bond), a fixed amount of interest over the length of the loan. The borrower also promises at the end of the loan to pay back the face value of the bond.
A mutual fund is a pool of monies/funds collected for the purpose of investing. Mutual funds allow investors to benefit from diversification and lower costs.
Companies require money to finance growth and operations. These companies typically face two options in securing these funds, borrowing (debt financing) and selling shares (equity financing). Debt financing has the drawback of requiring fixed interest payments at fixed intervals something that is frequently difficult for young companies. Equity Financing does not require the company to make fixed repayments on the amount invested, rather equity investors anticipate that the value of their investment will go up, and that the company will eventually be able to pay dividends to its shareholders.
In order for a company to offer shares to the investing public, the company must first file and register a prospectus with the Securities Commission of The Bahamas. The company is then able to sell shares to the investing public through an initial public offering.
BISX stands for Bahamas International Securities Exchange
BISX was incorporated as a private for profit company on 23 September 1999.
BISX maintains an electronic wide area trading network for it Members to trade Monday thru Friday at 10:00 a.m. to 3:00 p.m. excluding public holidays.
BISX is regulated by the Securities Commission of The Bahamas which is the statutorily created corporate entity charged with the regulation and oversight of the Securities Industry pursuant to the Securities Industry Act, 2011.
BISX is Registered as a ‘Securities Exchange’ in accordance with the provisions of the Securities Industry Act, 2011 and Securities Industry Regulations, 2012.
Listing shares on a regulated Securities Exchange helps a company to benefit from increased transparency of pricing, increased liquidity and market confidence. Each term is explained in turn.
Transparency of pricing – trades over BISX are carried out in compliance with the Exchange’s published trading rules, with all orders entered on the Exchange’s trading system and viewable by all buyers and sellers.
Increased liquidity – Liquidity is the ease with which trades can take place, since all buyers and sellers can see orders placed on the Exchange, this makes trading those shares easier than if they were not listed.
Market confidence – a company listed on the Exchange is bound by the rules of the Exchange as well as the laws of the Securities Industry Act, enforced by the Securities Commission of the Bahamas and so this company is doubly regulated.
Listing on BISX is a voluntary action by a company that means that a company has agreed to comply with the rules of BISX. This company’s securities are then eligible to trade over the Exchange.
Once a company has been formally registered with the Securities Commission of The Bahamas, the company, can then apply for their securities to listed on the Exchange by completing required documents and submitting them to the Exchange. Listing decisions for the Exchange are made by the BISX Listing Committee, a sub-committee of the BISX Board of Directors.
To buy or sell securities of a company listed on the Exchange, an investor would contact a BISX Broker Dealer who would carry out that transaction on their behalf. Contact Information for BISX Broker Dealer Members can be found in the “Members” Section of the BISX website.
Investors are recommended to discuss investment decisions with their financial advisor and/or broker dealer to find those investments that are most appropriate for them. Some factors that investors should consider when evaluating investments are risk tolerance, current financial situation, and age.
BISX maintains an Order Driven trading system. This means that anyone can enter a buy or sell order and the electronic trading system will place these orders in a queue where they will match with an opposing order. The BISX Automated Trading System maintains Trading Rules that places orders in a certain priority to ensure that there is fairness and equality in the execution of trades.
