The Spanish
Securities Market
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STRUCTURE, ORGANISATION AND OPERATION
OF THE SPANISH SECURITIES MARKET
In Article 31 of the new law, regulated markets
are defined as those multilateral systems that allow in-
terested parties in the purchase and sale of financial
instruments to be brought together to exchange con-
tracts with respect to financial instruments that have
been listed for trading. Spanish regulated markets have
been denominated official secondary markets. For such
purposes, the following are actually considered to be
official equity secondary markets: the Stock Markets,
the Book-Entry Public Debt Market, the Futures and
Options Exchange (MEFF), and the Fixed Income Mar-
ket, AIAF.
Apart from the regulated markets, Multilateral
Trading Systems (MTS) operate in Spain, trading both
shares that are listed in regulated markets (Stock Ex-
changes) and Book-Entry Public Debt issues.
The Spanish securities market has other specific
markets such the Market for Latin American Securities
(LATIBEX) and the Alternative Equity Market (MAB),
both for securities of special characteristics. The MAB
market has distinct sections for open-ended collective
investment schemes (SICAVs), venture capital firms
(VCFs), hedge fund (HF) companies, and for small- and
medium-sized enterprises. Trading in these markets is
done via multilateral electronic trading systems.
Bolsas y Mercados Españoles (BME) is the com-
pany that manages the main official secondary markets
(regulated markets) in Spain, and other multilateral
electronic trading systems. BME is made up of, among
others, the Madrid, Barcelona, Bilbao and Valencia
stock exchanges, the Options and Futures market MEFF,
the Fixed Income Market AIAF, and the business unit
responsible for the registration, clearing and settlement
of equity and fixed income securities (IBERCLEAR).
EQUITIES
The Spanish equity market operates via the SIBE
electronic trading platform, developed entirely by
BME, which guarantees full connectivity of the four
Spanish stock exchanges.
The market is based on an order-driven system,
a single electronic order book and a matching system
that operates on the basis of price-time priority. Open
outcry trading is still used for a small group of less li-
quid stocks. Apart from shares, warrants, certificates
and exchange traded funds (ETFs) are also traded elec-
tronically. Some market segments have specialist liqui-
dity providers.
Within the equity division, the Latibex market
deserves a special mention, it is a multilateral trading
system created in 1999, and is the only international
market solely for Latin American stocks.
FUTURES AND OPTIONS
Options and Futures are traded on the MEFF mar-
ket, with the underlying assets linked to individual
shares, the IBEX 35® index and various European stock
indices. MEFF derivatives provide investors with useful
tools to manage risk and to build hedge mechanisms
for all sorts of portfolios.
FIXED INCOME
The AIAF Corporate Debt and Private Fixed In-
come market is a solid source of financing for private
sector, regional and local public bodies in Spain. This
market lists and trades a wide range of assets and pro-
ducts that meet the needs of Corporate Debt issuers
and investors, giving issuers the fullest possibilities as
regards terms and fund raising strategies, and asset ma-
nagement in the case of investors.
Private and public sector fixed income issues lis-
ted on the four Spanish Stock Exchanges are also traded
on the SIBE platform. BME also manages a multilateral
electronic trading system for Book-Entry Debt issues.
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