The Stock Market &
The New York Stock Exchange
A stock exchange is a place where brokers buy and sell stocks for their customers. There are many stock exchanges throughout the world. The largest one is the New York Stock Exchange, often called the NYSE. It began exchanging stocks in 1792. In that year, 24 brokers got together under a buttonwood tree and signed a contract vowing that they would trade only with one another. It became known as the Buttonwood Agreement. Can you guess why?
From this the NYSE has grown into the largest exchange in the world. It is located on 18 Broad Street. Six marble columns are on the outside of the building. It has 16 separate trading floors. Electronic boards on two of the walls give the latest information on the stock values. These big boards may have helped give the
exchange its nickname-the Big Board.
But no one can predict the market as the "Crash of '87" shows. What began as a downward
slide in 1987, turned into a landslide as more investors cashed in sell orders. The trading floor had to be shut down four times that day because the volume of sell orders was
overwhelming. This further added to the panic. By the end of the day, $500 billion in stock value had disappeared. This time,
investors blamed automatic selling programs as the cause. Basically these were orders to sell stocks if they fell to a certain price. When all stock prices started to drop, automatic sell orders started selling everything. The strong economy at the time kept the country from another great depression.
Books & Web Sites
Kent, Zachary. The Story of the New York Stock Exchange.
Chicago: Children's Press, 1990.
Images of stock ticker, bull, bear, crowd of people, buy & sell and bag of gold from "Microsoft Office Online" <http://office.microsoft.com/clipart/default.aspx?cag=1> Images free for non-profit and personal use. (October-February, 2003-2004).
Stocks: Stocks are shares of a company that investors tell their brokers to buy when the prices are low. Investors do this in hope that the value of the purchased stock will go up so that investors can sell it for a higher price than they bought it for, making a profit. Return
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