Warsaw Stock Exchange (WSE): What It is, How It Works

What Is the Warsaw Stock Exchange?

The Warsaw Stock Exchange (WSE) is the largest stock exchange in Central and Eastern Europe and one of the most recognized financial institutions in Poland. It runs financial and commodities markets to trade instruments such as company shares, bonds, derivatives, and spot and forward contracts for electricity and natural gas.

Key Takeaways

• The Warsaw Stock Exchange (WSE) was founded in 1991 following the overthrow of Poland’s communist regime three years earlier.
• The WSE is the biggest exchange in Central and Eastern Europe. It operates a financial market and a commodities market.
• As of April 2021, there were 432 companies listed on the exchange’s main and parallel markets.

Understanding the Warsaw Stock Exchange (WSE)

Capital markets in Poland date to 1817 when the Warsaw Mercantile Exchange was founded. In 1991, the state treasury created the Warsaw Stock Exchange as a joint-stock company following the overthrow of Poland’s communist regime in 1989. The WSE was established as a modern stock exchange with electronic trading and dematerialized registration of securities.

Trading began on April 16, 1991. Five formerly state-owned enterprises were listed: Tonsil, Próchnik, Krosno, Kable, and Exbud. As of April 2021, the WSE listed 432 companies on its main and parallel markets, representing roughly 1.1 trillion PLN in market capitalization.

The WSE operates two main businesses: a financial market and a commodities market. The financial market trades in equities, derivatives, and bonds. The commodity market trades in spot and forward contracts for electricity, natural gas, and carbon emission allowances. Commodities trading contributes about 40% of group revenue.

Many economists expect that Eastern Europe will continue to be an area of rapid growth and the WSE will benefit from the increased investment. The WSE’s mission is to provide a competitive exchange and clearing services, support economic growth, and ensure high standards and safety of trading practices.

The exchange operates Monday through Friday, with equities sessions starting at 9 a.m. and concluding at 4:50 p.m. Derivatives products start trading at 8:45 a.m., while other investment products start at 9:05 a.m.

Corporate Social Responsibility

The WSE initiated the RESPECT Index in 2009, Central and Eastern Europe’s first index of socially responsible businesses. It covers companies from Poland and around the world that are listed on the WSE Main Market and follow the highest standards in corporate governance, disclosure, and environmental and social principles.

Companies in the index are screened by the WSE and the Association of Listed Companies (SEG) in a three-step review of these factors and are audited by the project partner.

Companies in the index are screened by the WSE and the Association of Listed Companies (SEG) in a three-step review of these factors and are audited by the project partner.