Vancouver Stock Exchange
Encyclopedia
The Vancouver Stock Exchange (VSE) was a stock exchange
based in Vancouver
, British Columbia
. It was incorporated 1906 and was the third major stock exchange in Canada, after the Toronto Stock Exchange
(TSX) and Montreal Stock Exchange (MSE), and featured many small-cap and exploration stocks.
In 1991, it listed some 2,300 stocks. Some local figures stated that the majority of these stocks were either total failures or frauds. A 1994 report by James Matkin (Vancouver Stock Exchange & Securities Regulation Commission) made reference to "shams, swindles and market manipulations" within the VSE. Regardless of the low opinion several held it in, it had roughly four billion dollars in annual trading in 1991.
On November 29, 1999 the VSE was merged into the Canadian Venture Exchange (CDNX), along with the Alberta Stock Exchange
(ASE) and the minor-cap stocks from the Bourse de Montréal (MSE). The trading floor of the old VSE remained as the trading floor of the new CDNX.
The history of the exchange's index provides a standard case example of large errors
arising from seemingly innocuous floating point calculations. In January 1982 the index was initialized at 1000 and subsequently updated and truncated
to three decimal places on each trade. This was done about 3000 times a day. The accumulated truncations led to an erroneous loss of around 25 points per month. Over the weekend of November 25-28 1983, the error was corrected, raising the value of the index from its Friday closing figure of 524.811 to 1098.892 .
Stock exchange
A stock exchange is an entity that provides services for stock brokers and traders to trade stocks, bonds, and other securities. Stock exchanges also provide facilities for issue and redemption of securities and other financial instruments, and capital events including the payment of income and...
based in Vancouver
Vancouver
Vancouver is a coastal seaport city on the mainland of British Columbia, Canada. It is the hub of Greater Vancouver, which, with over 2.3 million residents, is the third most populous metropolitan area in the country,...
, British Columbia
British Columbia
British Columbia is the westernmost of Canada's provinces and is known for its natural beauty, as reflected in its Latin motto, Splendor sine occasu . Its name was chosen by Queen Victoria in 1858...
. It was incorporated 1906 and was the third major stock exchange in Canada, after the Toronto Stock Exchange
Toronto Stock Exchange
Toronto Stock Exchange is the largest stock exchange in Canada, the third largest in North America and the seventh largest in the world by market capitalisation. Based in Canada's largest city, Toronto, it is owned by and operated as a subsidiary of the TMX Group for the trading of senior equities...
(TSX) and Montreal Stock Exchange (MSE), and featured many small-cap and exploration stocks.
In 1991, it listed some 2,300 stocks. Some local figures stated that the majority of these stocks were either total failures or frauds. A 1994 report by James Matkin (Vancouver Stock Exchange & Securities Regulation Commission) made reference to "shams, swindles and market manipulations" within the VSE. Regardless of the low opinion several held it in, it had roughly four billion dollars in annual trading in 1991.
On November 29, 1999 the VSE was merged into the Canadian Venture Exchange (CDNX), along with the Alberta Stock Exchange
Alberta Stock Exchange
The Alberta Stock Exchange was a stock exchange based in Calgary, Alberta. It featured mostly mining, resource exploration, and oil sands stocks....
(ASE) and the minor-cap stocks from the Bourse de Montréal (MSE). The trading floor of the old VSE remained as the trading floor of the new CDNX.
The history of the exchange's index provides a standard case example of large errors
Round-off error
A round-off error, also called rounding error, is the difference between the calculated approximation of a number and its exact mathematical value. Numerical analysis specifically tries to estimate this error when using approximation equations and/or algorithms, especially when using finitely many...
arising from seemingly innocuous floating point calculations. In January 1982 the index was initialized at 1000 and subsequently updated and truncated
Truncation
In mathematics and computer science, truncation is the term for limiting the number of digits right of the decimal point, by discarding the least significant ones.For example, consider the real numbersThe result would be:- Truncation and floor function :...
to three decimal places on each trade. This was done about 3000 times a day. The accumulated truncations led to an erroneous loss of around 25 points per month. Over the weekend of November 25-28 1983, the error was corrected, raising the value of the index from its Friday closing figure of 524.811 to 1098.892 .