Though the Caribbean is well-known for its beautiful beaches and vibrant music, it has an emerging capital market that should not be ignored. As many as twelve national stock exchanges can be found in the region. In addition, the Caribbean is also home to the first regional securities exchange to be formed in the Western Hemisphere. (For more, see An Introduction to Securities Market.)
In 1871, the Bermuda Stock Exchange became the first stock market in the Caribbean to give investors the opportunity to buy and sell shares in companies. The region’s most recently formed exchange is the Dutch Caribbean Securities Exchange, which was established in 2010. There are currently eight companies listed on that market.
Below is a list of the four stock exchanges where the majority of Caribbean stock trading activity takes place.
Eastern Caribbean Securities Exchange
With twelve listed companies, the Eastern Caribbean Securities Exchange (ECSE) is the Western Hemisphere’s regional securities market. Headquartered in the island of St. Kitts, a nation with a population of less than 60,000 people, the ECSE’s listed securities are a composite of government bonds, financial institutions and utility companies partially owned by Eastern Caribbean governments.
The ECSE serves the islands of Anguilla, Antigua and Barbuda, Dominica, Grenada, Montserrat, Saint Kitts and Nevis, Saint Lucia and Saint Vincent and the Grenadines. It provides the citizens of these small islands with the opportunity to own a stake in some of the region’s most eminent companies.
Barbados Stock Exchange
Although the Barbados Stock Exchange (BSE) is the third largest stock exchange in the Caribbean, its market capitalization is just under $2.75 billion. There are only twenty companies listed on the market, and many are only traded a few times a year. For example, shares in The West Indian Biscuit Company Limited, have not traded hands since August 2014. There are also many days where absolutely no trading takes place on the exchange.
The securities listed on the BSE are a composite of government bonds, corporate debentures and shares in businesses that mainly operate in the consumer goods and financial services industry. A handful of those firms are actually cross-listed on other regional and international exchanges. Sagicor Financial Corporation, which trades on the London Stock Exchange, and Trinidad Cement Limited, which trades on the Trinidad and Tobago Stock Exchange, are both examples of such companies.
Jamaica Stock Exchange
More than 45 companies that operate in the finance, communications, manufacturing, retail, real estate and tourism industries are listed on the Jamaica Stock Exchange (JSE), making it one of the Caribbean's largest, most liquid and sector-diverse stock exchanges. Shares on the JSE trade for only three and half hours each days. The JSE, which dates back to 1968, has played a critical role in the development and growth of the Jamaican private sector. To date, the market capitalization of the JSE is just over $3.3 billion.
Trinidad and Tobago Stock Exchange
Although the Trinidad and Tobago Stock Exchange (TTSE) has roughly the same number of listed companies as the JSE, it is by far the largest exchange in the region. The market capitalization of the exchange is more than $17 billion. Unlike the other regional exchanges that have seen significant declines in their market caps since 2010, the total value of the TTSE has been growing. The three largest companies listed on the TTSE are Trinidadian conglomerate ANSA McAL, Republic Bank Limited and National Enterprises Limited.
The Bottom Line
While a dozen national stock exchanges can be found throughout the islands of the Caribbean, the majority of the region's trading activity is done on four, including a regional securities exchange that serves islands belonging to the Organization of the Eastern Caribbean States (OECS). Generally, the stock exchanges in the Caribbean are small and have very low trading volumes. However, they provide households with an alternative to keeping money in a savings account.