The Johannesburg Stock Exchange (JSE) is a publicly-listed company on the Johannesburg Stock Exchange (JSE). The JSE is the 16th largest stock exchange in the world and the largest of 22 stock exchanges in Africa.
To buy JSE shares, retail traders and investors are required to go through a JSE-approved broker. There’s no method to purchase shares direct from the JSE without using a broker unless the company offers a direct stock purchase plan, which is rare in South Africa. Fortunately, online brokerage fees are inexpensive; ranging from only 0.25% to 0.5% per trade.
In this in-depth guide you’ll learn:
And lots more…
Let’s dive right in…
The Johannesburg Stock Exchange (JSE) is the largest stock exchange in Africa and is the dominant exchange in South Africa. The JSE was founded in 1887 by Benjamin Minors Woollan during the first gold rush when many mining and financial companies started operations on the Witwatersrand and the need for a stock exchange arose. Following the first legislation covering financial markets in 1947, the JSE joined the World Federation of Exchanges in 1963 and upgraded to an electronic trading system in the early 1990s. The bourse demutualised and listed on its own exchange in 2005. Today, the JSE offers five financial markets, namely Equities, Bonds, Financial, Commodity and Interest Rate derivatives.
The CEO of the JSE is Dr Leila Fourie (2019- ) and its headquarters are in Johannesburg, South Africa.
No, retail traders and investors cannot buy JSE shares direct from the JSE. A JSE-approved broker needs to purchase JSE shares on your behalf. Contact any mainstream bank in South Africa that offers a stock broking service or find a JSE-approved broker on the list provided below.
If you have never bought company shares before on a stock exchange, you need to decide first if you’re a trader or an investor. They are two very different approaches to profiting off the financial markets.
Traders use short-term strategies to maximise daily, monthly or quarterly returns. They take advantage of rising and falling markets as well as enter and exit points over a shorter timeframe. Traders take smaller but more frequent profits.
Investors use long-term strategies to get a larger return over an extended period of time. This means investors buy and hold shares, as opposed to trading them in a shorter timeframe. Most investors buy and hold shares for a long-term goal such as for their retirement or to make profits from their capital.
What is the difference between a trader and an investor?
The big difference between a trader and investor is traders typically buy shares as CFDs (contract for differences) which means they don’t own the underlying asset. Investors take ownership of the underlying asset and the shares are held for them on an investment platform.
Retail traders and investors cannot buy JSE shares directly from the JSE. The only way to buy JSE shares if you are a beginner is through a JSE-authorised broker or share CFDs via an online broker or bank using a trading platform. There is the option of investing in shares through an asset management company but that’s best left to the professionals.
Buying shares via a stock broker company
This is something also best left to advanced traders or investors with a lot of capital. This is because stock brokers charge substantial fees and commissions per transaction. Stock brokers are an old-fashioned way to buy and sell shares on stock exchanges and they’ve mostly been replaced by online brokers with electronic trading platforms.
Buying shares via an online stock trading broker
Online stock trading is the most popular method for beginners to buy and sell shares on the JSE. Traders and investors have access to the same global stocks as stock brokers via an automated trading platform and mobile apps, hosted by a regulated broker.
The cost of trading through an online broker is significantly cheaper than going direct to a stock broking company. If you’re tech savvy, you have a choice of a wide range of trading apps for buying shares on the financial markets. Stock trading apps puts the stock market in the palm of your hand.
Pros and cons of trading shares via an online trading broker
The advantages include:
️ you can trade share CFDs on leverage
️ the only cost associated with share CFDs is the bid/ask spread
️ you can short sell share CFDs without needing to borrow the shares
️ you can develop your own trading strategy to trade independently
The main disadvantage of trading through an online broker is the minimum trading requirement is reduced and shares are typically traded as CFDs. This means you don’t own the underlying asset. This isn’t an issue for beginner traders but it is if you’re an investor and you want to buy and hold shares for a longer period of time.
Beginner traders can easily trade the world’s largest company shares on a retail broker’s trading platform or through one of the mainstream banks in South Africa. Not all global online brokers offer the JSE Top40 Index so most South African traders buy domestic JSE shares through their bank.
Almost all major banks in South Africa offer an online trading service for retail traders and investors to buy shares. If you are a beginner trader, your local bank is your best option to buy JSE shares on the JSE.
How to get JSE Exchange-Traded Contracts for Difference (CFDs)
To access this product, contact one of the JSE’s Equity Derivatives members.
9 JSE-approved brokers to buy JSE shares in South Africa
|Share broker||Broker fee per trade||Admin fee per trade||Register|
|Absa Bank||0.40%||R75||Absa stock broking|
|bpbernstein||1.00%||R30||bpbernstein stock broking|
|Easy Equities||0.25%||R80 – R100||Easy Equities stock broking|
|FFO Securities||1.25%||R30||FFO Securities stock broking|
|FNB||0.50%||R87||FNB stock broking|
|Momentum Securities||0.50%||R45||Momentum Securities stock broking|
|PSG Wealth||0.90%||R55||PSG Wealth stock broking|
|Sanlam iTrade||0.50%||R50||Sanlam iTrade stock broking|
|Standard Bank||0.40%||R99||Standard Bank stock broking|
** Broker fees and admin fees subject to change: estimate for comparison only
Follow the multi-step process to register an online share trading account and deposit funds in the account.
FICA: Documents required for individual traders
Due to the SA government’s anti-money laundering legislation, JSE-approved brokers require original or originally-certified copies of the above documents.
The Johannesburg Stock Exchange (JSE) is based in South Africa where it has operated as a market place for the trading of financial products for over 132 years. The JSE connects buyers and sellers in equity, derivative and debt markets.
The JSE is the largest stock exchange in Africa and one of the top 20 exchanges in the world in terms of market capitalization. As of August 2020, the market capitalisation of the JSE was at US$1,005 billion.
The JSE is a member of the World Federation of Exchanges (WFE) and holds the chairmanship of the Association of Futures Markets (AFM).
The JSE offers an electronic, efficient, secure market with excellent regulation, trading and clearing systems, settlement assurance and risk management.
JSE Market Data provides a range of reliable and transparent market data products to market professionals and data distributors. JSE Market Data supports multiple use cases that require live data for JSE listed equities, derivatives and bonds. This data is generated across the various markets throughout the trading day.
JSE Market Data also provides an extensive range of index, stock exchange news, and historical and reference data services.
Market Data Available : CLICK BELOW
CFDs are Contracts for Differences. You get them for shares, commodities, forex, precious metals and energy and global stocks. Share CFDs are the most commonly-traded CFDs in the marketplace.
The CFD prices comes from the price of the underlying stock that is the subject of the CFD. Trading share CFDs feels exactly the same as buying and holding shares as an investor but the difference is you don’t own the underlying asset. Instead, you’re speculating on the price movement of the stock.
Share CFDs can be bought and sold easily on a broker’s trading platform. You take advantage of price movements in both rising and falling markets. Traders hope to make money by buying low and selling higher, or selling high and buying lower.
FOREX TRADING AFRICA DISCLAIMER
Trading share CFDs is highly speculative, involves a significant risk of loss and is not suitable for all investors.
Share CFDs are only suitable for traders who understand and are willing to assume the economic, legal and other risks involved; are experienced and knowledgeable about trading in derivatives and underlying asset types; and are financially able to assume losses significantly in excess of margin or deposits if trading on leverage and margin.
Forex Trading Africa aims to educate its readers on products and services available to access the global financial markets. Readers assume the risks of trading CFDs and trade independently of any information provided on the Forex Trading Africa website.