A Brief History Of The Stock Market

A Brief History of the Stock Market

What a Stock Symbolizes

A stock is a legal symbol of ownership in a business. When you buy stock, you are actually buying part-ownership of the business. In other words, you become a shareholder. A business will typically spread ownership to hundreds or even thousands of shareholders. Shares are sold when the company wishes to get cash. In a small business, it may be said that the owner has 100% of all shares. However, when a business grows beyond a certain size, it may require capital for expansion and selling shares is the easiest way to do that.

On Stock Holders

Most stock holders do not really have much say in how the business is run because their ownership proportion is negligible. In order to make a difference, you must own lots of shares or you must work with several smaller shareholders. Now days, buying stock has become more of an investment rather than trying to run the business. You simply buy stock and wait for the company to grow. This will appreciate the stock value and you make money by selling it. Or you could simply make do with the percentage of profits the company gives you based on your shares.

The Stock Exchange

The stock exchange is the place where people trade stocks. The three important share markets in the United States are the folowing:

  1. New York Stock Exchange,
  2. American Stock Exchange, and
  3. Nasdaq.

Stocks are bought and sold through stock brokers or Direct Investment and Dividend Reinvestment Plans. The plans allow you to purchase the stock directly from the companies instead of the market.

Wall Street

Wall Street is a famous and important place when it comes to the American stock market. The street is named after the high fence built by the Dutch settlers in New York during the 17th century. Though the fence lasted till 1685, the street next to it was permanently named Wall Street. The history of the American stock exchange begins in Philadelphia. The first stock exchange was built here in 1770. Two years later, the first New York stock exchange was opened, though it was less successful. In 1817, New York stock exchange representatives traveled to Philadelphia to understand why it was more active.

This created a more disciplined and formal New York Stock and Exchange Board.

The Crash of 1929

Another important point in this history is the crash of 1929. This crash triggered the Great Depression.

I eFinancials.site I Copyright 2020. All Rights Reserved. I This website is Built with DIVI Builder I Hosted by 300% Renewable Energy I Powered By WordPress I

AFFILIATE DISCLOSURE

This website contains affiliate links. The links may appear on different posts and pages on this site. We may receive compensations in the form of  advertising fees or other financial rewards on qualifying purchases made through these Affiliate Links. We do not markup any prices from any vendors or company-providers. Thus, there is no additional charge on your part. The best thing is that, your support in purchasing through these links enables us to keep tons of the site information material contents for FREE; Your support can also help us to cover the costs in operating and maintaining this website.

DISCLAIMER

Documents and other contents posted on this site may also contain links to information created and maintained by Third-Parties. These links are provided solely for your convenience and for your information purposes only. This site is not endorsed by anyone or by any company. This is an independent site. All information (including prices, dates, times, availability) contained on this site are unofficial and subject to change without notice. Please see our FULL DISCLAIMER. Thank you and we appreciate your support!.

Risk Warning

Trading in the financial markets (including trading on margin) provides a wide range of opportunities and enables investors who are ready to take risks to make high profits. However, it carries a potentially high level of risk of loss at the same time. You should never invest money that you cannot afford to lose. Therefore, prior to trading and or investing, you should take into careful consideration whether such operations are suitable for you in terms of your level of knowledge and financial situation. Your due diligence and education on Trading & Investments is therefore highly recommended.

Submit a Comment