The History of Stock Markets

There are millions of ways to make money in the world. Every day millions of people invest their money in the New York Stock Exchange (NYSE). On average, there are five trillion dollars in stocks traded daily (Picardo).This is one of the reasons America has the largest economy in the world. The stock market creates jobs for thousands of people and has done nothing but show a steady increase since the day it opened (Knight). Wall Street symbolizes the way America’s economy is a free market. The stock market affects almost everybody, not only in America but all over the planet.

In the beginning, there was no real stock market. However stock exchanges did take place in smaller groups and corporations. This all took place during the 1700's where stocks were already around for a long time before that but it wasn't really popular in the United States. Stocks originally started as auctions where traders called out names of companies and the shares available. There was a auction that took place and the shares went to the highest bidders.

‘The stock market is always volatile, from the moment it opens each day to the moment it closes, companies can expect sharp rises and sheer drops in their stock price in a matter of

In order to succeed in any business, it is extremely important to understand the stock market. In this assignment we were asked to follow the stock market continuously for four months and understand the market. The stock market is a global marketplace, where goods and services are traded in the form of equities.

According to Alfaro, Chanda, Kalemli-Ozcan, & Sayek (2004) stock markets play a vital role as they allow investors to buy and sell shares in publicly traded companies. They are one of the most vital areas of a market economy as they provide companies with access to capital and investors with a slice of ownership in the company and the potential of gains based on the company 's future performance.

The “Stock Market” is a term that actually describes several markets such as the New York Stock Exchange NASDAQ, where the stocks of companies are traded. Shares in a company are sold and the shareholders then become part owners of the company. Offering shares of stock raises money for continued research and development of company products or services.

The stock market works by increasing the value of stocks based upon multiple factors. One of the factors is company performance. The better the company is doing the more stocks will increase and vice versa. Another factor is the demand. The more demand the bigger the price and also vice versa. So to maximize the amount of money you get from a stock you need many people buying that stock and having the company do well.

The stock exchange is a place where individuals or investors can buy and sell shares of stock in any company on the list of exchange. Most people in the United States talk of stock exchange, referring to the New York Stock Exchange (NYSE). NYSE is the largest in the world with increasing importance of Internet trading, moving more and more from a physical trading floor to a global network of exchanges linked electronically from cyber space (Jill, 2006).

Ever heard of the phrases "the stock market has crashed" or "the stock market is at an all time high"? But what exactly is the market and how does it work? In order to understand the basics of the stock market, one must initially understand the meaning of the word stock. Stock can simply be defined as the ownership in a company that results in future inflow of cash in terms of dividend and capital gains of the organization. A simple certificate provides a person with the part ownership of the company. However, the extent of rights that can be exercised over the ownership of the company depends on the type of stock that has been bought. The question that now arises is how does one get hold of the stock?

Within New York City, Wall Street is concentrated with most of United States’ financial industries. Through different movies, such as Leonardo DiCaprio’s Wolf of Wall Street and Charlie Sheen’s Wall Street accurately portray the heart of Wall Street: The New York Stock Exchange. The New York Stock Exchange began on May 17, 1792, the earliest record of organized securities trading. On that day, twenty-four brokers signed the Buttonwood Agreement, setting a floor commission rate of 0.25% charged to clients and give the signers the preference to other singers in the securities sales, thus eliminating the auctioneers. At the beginning, the earliest trades were mostly War Bonds used in the Revolutionary War, allowing the thirteen colonies to fund enough money to engage in war against the Britain. Thus, they began operated in 1793 at the Tontine Coffee House, built to serve as a meeting place for trading. However, issues such as corruption and manipulation of the market began to arise, causing the stockbrokers to instituted reforms and reorganized. As a result, on 1817, the stockbrokers under the Buttonwood Agreement began reforms such as restrictions on manipulative trading and prevention of leaking market information were enacted to make sure the trading market remain as a competitive market. In addition, they also renamed their broker organization as “New York Stock and Exchange Board”, in hopes to demonstrates their reform to the public. As time continues, the invention of

Stock Market is basically a stock exchange. An example of a stock market is the NASDAQ founded in 1971.

The New York Stock exchange started when the Buttonwood Agreement was signed by twenty-four New York City stockbrokers and merchants on May 17, 1792, outside at 68 Wall Street under a Buttonwood tree. It was orginally called The New York Stock and Exchange Board (New York Stock Exchange).

A stock market is a place where stocks or shares are bought or sold. An example of a stock market is New York stock exchange and Nigerian stock exchange.

The Stock Market is an organized market for the trading of stocks and bonds. In Europe a stock exchange is often called a bourse. Stock exchanges exist in all-important financial centers of the world. Members of an exchange buy and sell for themselves or for others, charging commissions. A stock may be traded only if it is listed on an exchange after having met certain requirements. The New York Stock Exchange (founded 1790) is the largest in the U.S., handling more than 70% (in market value) of all transactions. The American Stock Exchange (Amex), also in New York City, and regional exchanges account for the remainder. Unlisted shares, often of smaller companies, are traded in the growing over-the-counter

The number of seats has remained constant, at 1,366, since 1953. Institutional investors are corporations that invest on behalf of individuals and companies. Institutions include pension funds, mutual funds, insurance companies and banks Buy and sell orders meet directly on the trading floor, and prices are determined by the interplay of supply and demand. In contrast, in the over-the-counter market and the price is determined by a dealer who buys and sells out of inventory. At the NYSE, each listed stock is assigned to a single post where the specialist manages the auction process. NYSE members bring all orders for NYSE-listed stocks to the Exchange floor either electronically or by a floor broker. A broker acts as an agent, representing customer orders to buy or sell stock. There are two main types of floor brokers: commission brokers and independent brokers. Commission Brokers. Commission brokers are employed by brokerage houses, which are members of the NYSE. A commission broker executes the orders of his firm's customers. Independent Brokers. Independent brokers work for themselves. Although they are not affiliated with any brokerage house, they handle orders for brokerage houses that do not have full-time brokers, whose brokers are off the floor, or are too busy to handle a specific order. Independent brokers were once referred to as "$2 brokers," a term coined when they received $2 for every 100 shares they traded. Their fee, paid by commissioned