New York Stock Exchange facts for kids
| New York Stock Exchange | |
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Quick facts for kids NYSE Logo 2022.svg |
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| New York Stock Exchange Facade 2015.jpg | |
| Type | Stock exchange |
| Location | [[New York City]], U.S. |
| Founded | May 17, 1792 |
| Owner | Intercontinental Exchange |
| Key people |
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| Currency | United States dollar |
| No. of listings |  6,332 (Feb 2024) |
| MarketCap | US$25.564 trillion (Feb 2024) |
| Indexes |
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The New York Stock Exchange (NYSE), also known as "The Big Board", is a famous stock exchange located in the Financial District of New York City. It is the largest stock exchange in the world based on the total value of all the companies listed there.
The main trading area of the NYSE is at the New York Stock Exchange Building on Wall Street. This building is a very important historical site. The NYSE is owned by a company called Intercontinental Exchange. Many adults in America, about 58%, have money invested in the stock market through places like the NYSE.
Contents
History of the NYSE
The New York Stock Exchange started a long time ago. In 1792, twenty-four stockbrokers signed an agreement called the Buttonwood Agreement. This agreement helped them trade stocks and bonds more easily. Before this, people traded stocks through auctioneers who also sold other things like wheat.
In 1817, the brokers made their organization more formal. They called themselves the New York Stock and Exchange Board. They started renting special places just for trading stocks. This was a big step from trading in coffee houses!
The invention of the electrical telegraph helped the New York market become very important. In 1869, a competing group called the Open Board of Stock Brokers joined with the NYSE. This made the NYSE even bigger and more powerful. The Civil War also made stock trading in New York grow a lot. By 1869, there were so many members that they had to limit how many people could join.
In the early 1900s, there were times when the stock market had big ups and downs. After a huge stock market crash in 1929, which led to the Great Depression, new rules were made to protect investors.
In 2005, the NYSE decided to become a public company. This meant its own shares could be traded, just like the companies it lists. In 2007, the NYSE joined with Euronext, a European stock market, to form NYSE Euronext. This created the first stock exchange that operated across the Atlantic Ocean. Later, in 2013, Intercontinental Exchange bought NYSE Euronext.
Important Moments in NYSE History
The NYSE has seen many important events over the years.
20th Century Events
- 1914: The exchange closed briefly at the start of World War I. It reopened to help the war effort by trading bonds.
- 1920: A bomb exploded outside the building, causing many injuries.
- 1929: The "Black Thursday" and "Black Tuesday" crashes happened. These huge drops in stock prices are often seen as a cause of the Great Depression.
- 1938: The NYSE introduced a plan to better protect investors.
- 1943: During World War II, the trading floor was opened to women for the first time.
- 1963:
- 1967: A famous prank happened when Abbie Hoffman threw fake money onto the trading floor. After this, the gallery was enclosed with bulletproof glass.
- 1985:
President Ronald Reagan speaking at the NYSE. - 1987: "Black Monday" saw the Dow Jones Industrial Average (DJIA) drop by 22.6% in one day. This was one of the biggest single-day drops ever.
- 1989: The "Mini-Crash of 1989" occurred, another significant drop.
- 1997: The "1997 Mini-Crash" happened due to problems in Asian markets. This was the first time the "circuit breaker" rule was used to stop trading temporarily.
21st Century Events
- 2000: The band Rage Against the Machine tried to enter the exchange during a music video shoot, causing the doors to close.
- 2001: After the September 11 attacks, the NYSE closed for four trading days. When it reopened, the market dropped significantly.
- 2003:
Security at the NYSE after the September 11 attacks. - 2010: The "2010 Flash Crash" saw the Dow Jones Industrial Average drop almost 1,000 points in minutes before recovering.
- 2012: The exchange closed for two days because of Hurricane Sandy.
- 2015: Technical issues caused trading to stop for several hours on July 8.
- 2018: Stacey Cunningham became the first female president of the NYSE in its 226-year history.
- 2020: The NYSE temporarily moved to all-electronic trading because of the COVID-19 pandemic. It reopened for in-person trading later that year.
The NYSE Building
The main New York Stock Exchange Building was built in 1903. It's located at 18 Broad Street. The building has a grand and classic style called Beaux Arts. It's considered a very important historical landmark.
Trading at the NYSE
The New York Stock Exchange is a place where people can buy and sell shares of companies. It's open from Monday to Friday, 9:30 am to 4:00 pm ET, except on holidays.
Trading at the NYSE happens in a special way called a "continuous auction." Traders gather around specific spots on the floor. A "specialist broker" acts like an auctioneer, helping buyers and sellers agree on prices. They also share information to help trades happen smoothly.
In 1995, trading started to become more electronic. Traders began using wireless handheld computers to send and complete orders. By 2007, most NYSE stocks could be traded electronically. The NYSE works with government groups like the SEC to make sure electronic trading is safe.
After a big market crash in 1987, the NYSE put in place "circuit breaker" rules. These rules temporarily stop trading if the market drops too much, to prevent panic selling. For example, if the S&P 500 index drops by 7% or 13%, trading stops for 15 minutes. If it drops by 20%, trading stops for the rest of the day.
Trading Rights and Licenses
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For many years, only people who owned a special "seat" could trade directly on the exchange. These seats were very valuable. In 1929, a seat sold for $625,000, which would be over six million dollars today!
In 2005, when the NYSE became a public company, the system changed. Now, instead of buying a "seat," people buy yearly licenses to trade. These licenses are much cheaper and allow people to trade directly on the exchange floor.
NYSE Composite Index
In the 1960s, the NYSE Composite Index was created. This index measures the value of all stocks traded on the NYSE, not just a few like the Dow Jones Industrial Average. This gives a broader picture of how the entire market is doing.
Timeline of Key Events
- 1792: The NYSE begins with its first traded stocks.
- 1817: The New York Stock and Exchange Board is officially formed.
- 1863: The name changes to the New York Stock Exchange.
- 1867: Stock tickers are first used, showing prices in real-time.
- 1896: The Dow Jones Industrial Average (DJIA) is first published.
- 1903: The NYSE moves into its current main building at 18 Broad Street.
- 1929: The "Black Thursday" and "Black Tuesday" crashes happen, leading to the Great Depression.
- 1943: Women are allowed on the trading floor for the first time.
- 1967: Protesters throw fake dollar bills from the gallery, leading to bulletproof glass being installed.
- 1971: The NASDAQ, the world's first electronic stock market, is founded.
- 1987: "Black Monday" sees a massive one-day drop in the DJIA.
- 1997: The "circuit breaker" rule is used for the first time during a market drop.
- 2001: The NYSE closes for four days after the September 11 attacks.
- 2006: The NYSE merges with ArcaEx and Euronext, forming a transatlantic stock exchange.
- 2010: The "Flash Crash" causes a rapid, temporary drop in the market.
- 2018: Stacey Cunningham becomes the first female president of the NYSE.
- 2020: The NYSE temporarily switches to electronic trading due to the COVID-19 pandemic.
Opening and Closing Bells
The NYSE's opening and closing bells are very famous. They mark the start and end of each trading day. The opening bell rings at 9:30 am ET, and the closing bell rings at 4 pm ET. There are bells in four main sections of the NYSE, all ringing at the same time when a special button is pressed.
History of the Bells
At first, a gavel was used to signal the start and end of trading. Later, a gong was used. When the NYSE moved to its current building in 1903, they started using the bell system we see today. The bells were made by Bevin Brothers in Connecticut, a town famous for making bells.
Today, it's a big event when a celebrity or a company executive rings the bell. Companies often plan new product launches or other big announcements for the same day their representatives ring the bell. This tradition of having special guests ring the bells started in 1995. Before that, it was usually the exchange's floor managers who did it.
Famous Bell-Ringers
Many important people have rung the NYSE bells. These include business leaders, but also:
- Politicians: Like former Mayor of New York City Rudy Giuliani and former President of South Africa Nelson Mandela.
- United Nations Leaders: Kofi Annan and Ban Ki-moon have rung the bells.
- Athletes: Such as Joe DiMaggio and Olympic swimmer Michael Phelps.
- Entertainers: Including rapper Snoop Dogg, Liza Minnelli, and the rock band Kiss.
- Public Heroes: Members of the New York City Police Department and New York City Fire Department rang the bell after the September 11 attacks.
- Fictional Characters: Even characters like Mickey Mouse, the Pink Panther, and Darth Vader have had a turn!
Images for kids
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The trading floor of the New York Stock Exchange in March 2022.
See also
In Spanish: Bolsa de Nueva York para niños
- Economy of New York City
- Economy of the United States
- List of American Exchanges
- U.S. Securities and Exchange Commission
