Stock Exchange History

The history of the stock exchange goes a long way back to as early as 400 years ago, and even further to the first broker’s in 12th century France who were not broker’s as we have come to define the term today, but nonetheless as they were concerned with debt management and recovery on behalf of banks, we consider them to be so. From here, the history of the stock exchange moves continues to the 13th century to the Bourses- from Bourse which was the name of a man in whose house the first traders met and developed into the trading houses. These operated mainly in the low countries in places like Flanders and Ghent and Amsterdam, and finally, to the first stock trading companies in Amsterdam, where the earliest organized and continuous trading began.

The oldest “stock exchange” is considered to be the Amsterdam beurs where the VOC (Vereinigte Ostindische Compagnie) or the Dutch east India company started issuing shares in 1602. Other “old” Stock exchanges like the London stock exchange had their inception in the coffee houses of London, leading eventually to the formation of the London stock exchange.

In fact the name “the stock exchange” was a moniker that stock traders in London, applied to their new building, a coffee house cum trading center as opposed to the “Royal exchange.” In Britain most stock from the 1700’s on was traded in informal coffee houses and The first regulated exchange in stocks or marketable securities began only in 1801, with formal memberships based on subscriptions and this year can be regarded as the beginning of the true or modern stock exchange, as we know it, sometime later codified rules were introduced.

In the United States, the oldest stock exchange is the Philadelphia stock exchange, began 1790 as compared to the New York stock exchange, that has a history dating to 1792, and is of course the second largest-the largest is the NASDAQ since 1996- and the most prestigious exchange in the world today, other stock exchanges have varied histories, the first stock exchange in Asia, for example, is the Bombay stock exchange, which began trading in 1875, and is older by three years than the Tokyo stock exchange, which began in 1878.

In principle, a typical stock exchange is run by broker and brokerage firms, but the internet revolution and the spread of ECN’s or electronic communication networks has made most high value stock’s, like those listed on the NASDAQ, mostly off the floor deals, The nature of the Stock exchange has changed as well, traditionally individuals were the main player’s, nowadays most investors have become institution’s, this has been a long journey from the coffee houses of London.

From: http://agonist.org/Learning-Center/Stock_exchange_history.htm