Wall Street is perhaps one of the most famous streets of New York. Money is often associated with the name of this street. Wall Street is home to the largest stock exchange in the world – the New York Stock Exchange (NYSE). Here they make money every day, millions and billions pass from hand to hand. Today about 3000 companies are traded on the stock exchange, and the total value of all shares is more than 16 trillion dollars.
We are going to describe the history of this exchange, how it all began, what difficulties arose in the process of creating the financial center of the world. Planning to visit the NYSE? Car rental in New York JFK airport will be supportive in it.
Securities trading in New York started in 1725 and the NYSE was opened in May 1792. At that time, there were no such concepts as the stock exchange and brokers, but there were people, who, through mutual agreements, managed a few securities. Their task was to find interested persons. The absence of a specific scheme and laws, communication problems, as well as the impossibility of creating a single schedule, did not allow this direction to develop for a long time.
For the year 1792, a certain coalition was formed in the city. It consisted of 24 venerable brokers who decided to put their work together. The result was the signing of a pact, according to which, the first small securities trading enterprise began its existence. The signatures were put under the plane tree. The phrase “agreement under the plane tree”, in fact, is the basis of the modern world of the NYSE. Its other name, which is most relevant today, is the Buttonwood Agreement.
Its signing established a certain framework, which made it possible to introduce the ability to regulate the trading of securities, as well as to defend the interests of both parties. The most important aspects include:
- the creation of rules, governing the determination of the value of securities;
- rules for regulating sales and purchase procedures;
- temporary, as well as financial constraints for each transaction.
The enterprise was significantly different from the modern stock exchanges we are used to. In fact, it was a table on Wall Street, which was installed on the pedestrian side.
Soon, in 1863, the exchange was given a new name – the New York Stock Exchange. After 2 years, the exchange changed its place, it moved to Broad Street. Activity acquired legal turnover and every prudent enterprise, having perceived the prospect of trading in securities, began to actively prove its liquidity.
Initially, such companies had to prove at certain indicators. These were:
– indicators of annual taxes;
– income level;
– level of turnover.
The number of seats was limited, which was the starting point for applying a special status to the exchange. To get into its ranks was considered luck, as demand increased significantly. By the way, such relationships have remained to this day, but the scale has changed significantly.
In 2000, a new location was introduced on 30 Broad Street, it was called ‘the Bond room’. However, in 2006, the need for additional space decreased, the building was closed. The New York Stock Exchange has become a public corporation and the opportunity to trade its shares has appeared.
On April 4, 2007, a major merger was completed between the two exchanges, the New York Stock Exchange and the EuroNext. As a result, the new exchange has become the first transatlantic stock exchange.
Such a machine, like the NYSE, should have its own levers for control. Their role, like many years ago, play indices. Their use allows getting an intermediate average result of turnover. If necessary, certain adjustments can be made to stabilize the situation. Current indices are a key element in the formation of trends. This tool, when properly applied, can be the basis of a trader’s success.
Today, the NYSE occupies an old mansion on Wall Street (the one that once had the first brokerage “office” in the shape of a table on a footpath).
The exchange lives on the development of the economy, and the economy, in turn, can be viewed on the example of the work of a powerful system with a world name. This is a cruel, but very interesting world, where everyone lives by special rules.
