What is the London Stock Exchange?

The London Stock Exchange (LSE) is the United Kingdom's primary equity market and one of the most internationally significant exchanges in the world. Founded in 1801, it is headquartered at Paternoster Square in the City of London and operates under the oversight of the Financial Conduct Authority (FCA).

The LSE runs two main trading venues. The Main Market is the senior market, subject to the highest regulatory standards and home to the companies that make up the FTSE indices. It is split into the Premium Segment (higher disclosure and governance requirements) and the Standard Segment (aligned to EU minimum standards). A third category, the High Growth Segment, is aimed at high-growth, revenue-generating companies that are not yet profitable enough for the Premium Segment.

The Alternative Investment Market (AIM) is the LSE's market for smaller and growth-focused businesses. It operates under a lighter regulatory regime, with each company supervised by a nominated adviser (Nomad) rather than directly by the FCA. AIM stocks are not eligible for inclusion in the main FTSE indices, though some feature in the FTSE AIM indices.

Trading on the LSE is electronic and uses two main mechanisms: the Stock Exchange Electronic Trading Service (SETS) for the most liquid shares, which is an order-book system where buyers and sellers are matched directly, and the Stock Exchange Automated Quotation (SEAQ) system for less liquid stocks, where market makers quote firm bid and offer prices.

Settlement is handled by Euroclear UK & Ireland (formerly CREST), with standard settlement at T+1 following the UK's move from T+2 in October 2024.