The ‘Big Bang’ refers to the deregulation of the London Stock Exchange, which took place on 27 October 1986. As a result, foreign firms were allowed to buy UK stockbrokers; fixed share-dealing commissions were scrapped; and firms were allowed to act as both brokers for clients and deal for themselves. At the same time, the open outcry system of the old London Stock Exchange trading floor was replaced with computerised trading. The changes are seen as among the most important factors leading to the City’s current position as a top global financial centre. Traditional brokerages vanished, paving the way for today’s huge investment banks, while, most importantly for the private investor, competition drove down share dealing costs.
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