Newyork stock exchange
The New York Stock Exchange commonly referred to by its acronym NYSE is the biggest stock exchange in the world. The exchange has a major impact not only on American markets but all the global markets as well. It is by far the most powerful stock exchange in the world. Millions are earned and lost - all in a matter of seconds. It will not be wrong to say that The New York Stock Exchange is one of the most important economic centers of the world.
The NYSE has a long history behind it. On the 17th of May, 1792 twenty four stock brokers got together outside 68 Wall Street in New York and signed an agreement to start a stock trading organization. The agreement became famous as the Buttonwood Agreement as it was signed under a buttonwood tree. The organization changed its name to the New York Stock Exchange and Board on the 8th of March, 1817. The first office of the NYSE which was on 40 Wall Street was in a relatively small room which had been rented for a mere 200 dollars a month. The first president of the exchange was Anthony Stockholm. In 1863 the organization's name was changed to its present one - the New York Stock Exchange.
Initially, the exchange did not attract much trade and grew at a rather slow
pace. But between 1896 and 1901 the exchange saw a massive increase in the
volume of the stocks being traded. As a result the board of the NYSE decided
that it was time to look for a bigger office to carry out their growing business
operations. After a competition involving eight of the best architects in
the country, George Post's designs for the new building were selected. The
new NYSE building on 18 Broad Street was built at a cost of more than 4 million
dollars and started functioning on the 22nd of April, 1903. The trading floor
has a 72 foot ceiling and is 109 by 140 feet big. The building's main facade
is decorated by John Quincy Adams Ward's exquisite marble sculpture which
stands above six Corinthian capitals which are commonly called "Integrity
Protecting the Works of Man". In acknowledgment of the building's iconic
status in American economy, it was listed as a National Historic Landmark
in 1978.
But even this new building was not big enough to accommodate the NYSE's ever expanding operations. And with time as per growing requirements new buildings were incorporated into the NYSE. In 1922, a building on 11 Broad Street was added for office purposes and so was a new trading floor which is now called the garage. More trading floor area was added in 1969. And in 1988 another trading floor called the blue room was added which was fitted with modern equipment to display all kinds of information and for communication. Briefly between 2000 and 2006 the NYSE had another trading floor on 30 Broad Street but with more and more trading happening electronically, the floor was shut down.
The NYSE is today the world's largest stock exchange in terms of dollar volume. And by number of companies listed, it is the second largest in the world after the NASDAQ. At the end of last year the NYSE had a global capitalization of more than 25 trillion dollars. All operations are handled by NYSE Euronext which was formed as a result of the merger between Archipelago Holdings and Euronext. The main trading floor used today consists of four rooms and is on 11 Wall Street which is the financial capital of the world. The NYSE is also popularly called the Big Board because of the large volumes of shares it trades daily.
If you want to trade shares in an efficient manner, the NYSE is the place for you. You can buy and sell shares of numerous companies which are registered for public trading. Buying or selling - you will always get the best price at NYSE. The floors opening for trading at 9:30 a.m. Eastern Time and close at 4 pm after much hectic activity. These trading times have remained constant for the past 22 years. What makes trading at NYSE easier is that since the 24th of January, 2007 all stocks of the NYSE can now be traded electronically using the Hybrid Market. Only a handful of really high value stocks can not be traded via the Hybrid Market. In fact the electronic method of trading is so effective that more than half the trading is now done electronically.
The NYSE has an interesting format of trading. It follows the continuous auction format. It is different from fully electronic markets in the sense that it requires human interaction and expert judgment for good order execution. Each listed stock has a specific location on the trading floor from where it is traded. Members of the NYSE who wish to buy or sell that stock are required to gather near the area appropriated for it. The role of auctioneer is played by a broker who works for a NYSE member firm and not the NYSE. The trading is done like in an open outcry auction market where the buyers and sellers come together to perform their respective actions. A trading session is a sight in itself with all the frenzy and excitement around it.
The NYSE Composite Index - the indicator of the economic well being of the various stocks listed in NYSE was created in the mid 1960s. This is a index with a much wider base as compared to the Dow Jones Industrial Average which is based on only 30 stocks. The base value of the NYSE Composite Index was reset in 2003 at 5,000 points equal to the 2002 annual closing point. When the NYSE Composite Index was started its base value was only 50 points equal to the yearly close of 1965. The NYSE has special seats - the owners of which have the reserved rights of directly trading shares on the exchange. The number of seats has varied over time but for the past few years it has been fixed at 1366. These seats are much sought after which makes them very expensive as well. In 1929 one of these seats was sold at $625,000 which would today amount to more than six million dollars after adjusting inflation. In the past couple of years the price of a seat on an average has been around 4 million dollars. Nowadays the NYSE also sells year long licenses which let you trade directly on the exchange.
The importance of the NYSE is reflected in the fact that stocks of the entire
world's biggest companies are listed on it. The exchange plays an important
role in global economy and influences the prices of shares all over the world.
The present Chairman on the NYSE is Marsh Carter. The CEO is John Thain while
Gerald Putnam and Catherine Kinney are the co-Presidents. The NYSE Composite
hovers around the 10,000 points mark these days while the Dow Jones Industrial
Average stands at about 14,000.
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