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Brazilian Stock Exchange is a self-regulating entity operating under the supervision of
CVM – Comissao de valores Mobiliarios, the Brazilian equivalent to the SEC - Securities and
Exchange Commission in the US. In 1972, Bovespa implemented automated trading sessions
with information displayed on-line and in real-time via a computer terminal network and in the
late 70s, Bovespa introduced the options market in Brazil (Eiteman 162). By using electronic
technology, Bovespa has expanded the potential information processing volume and has
consolidated its position as the most important trading center in the Latin American market
despite the barriers that arise from the fact that the Latin American economy has not kept pace
with development as well as other countries of the business world.
Brazil stock exchange market (BOVESPA), rallied 2410 points or 4.22% during the last
30 days. Since 1976 Brazil Stock Exchange (BOVESPA) index points reached an all time high
of 73517 index points in May of 2008 and a record low of 0 index points in June of 1984
(Thompson 5). BOVESPA is a major stock market index which tracks the performance of
around 50 most liquid stocks trended on the Sao Paulo stock Exchange . The index has a base
value of BRL 100 as of January 1968. The BOVESPA index has been adjusted 11 times by a
factor of 100 in 1983 and by factor of 10 in 1985, 1988, 1989, 1990, 1991, 1992, 1993, 1994,
and 1997.
The success of BOVESPA is attributed to a significant credibility engendered by
Mercado regulations. ‘Market exit’ availability that has encouraged the development of private
equity industry, growth of Brazilian industry banking and thriving asset management industry. It
can also be attributed to the adoption of electronic trading system which was implemented
successfully in the year 1997 (Shapiro 400). This extended the potential volume of processing of
