The New York Stock Exchange: Our History

new york stock exchange american stock exchangeOn May 17, 1792, twenty-four stockbrokers gathered outside 68 Wall Street under a buttonwood tree to sign an agreement that would establish the rules for buying and selling bonds and shares of companies. The Buttonwood Agreement, as it is known, is so named because the tree served as the regular meeting place for these pioneers of Wall Street. The signers of the Buttonwood Agreement drafted their first constitution on March 8th, 1817, and named their nascent organization the New York Stock & Exchange Board.

In 1863, this name was shortened to its modern form, the New York Stock Exchange, which became known as the NYSE, one of the best-known financial industry brands in the world. Membership on the NYSE has been held as a valuable property since 1868. Until the NYSE went both electronic and public in April 2006, the exchange was a membership-only organization. You could only join the NYSE by purchasing existing seats, which were limited to a total of 1,366.

Merging with the already publicly-traded Archipelago electronic stock exchange, the new company was called the NYSE Group, Inc., and the seats of the NYSE translated into shares of stock which are now traded under the ticker symbol NYSE: NYX. In 2008, NYSE Euronext welcomed the historic American Stock Exchange into the world’s largest and most liquid exchange group. Originally called the "curb market" because its brokers traded outdoors in the street, the MKT has been at the forefront of the U.S. financial markets over the course of two centuries.

The New York Stock Exchange Building

As the 20th Century dawned, the NYSE was firmly established as one of America’s preeminent financial institutions.  It was also experiencing a sustained rise in trading volume. Trading in listed stocks tripled between 1896 and 1899. It would nearly double again by 1901.

More space was clearly needed. So the Exchange invited eight of New York City’s leading architects to join in a competition to design a grand new building. Their instructions: The trading floor was to have more space, more light, and more convenience for the transaction of business. The Exchange chose the neoclassic design of architect George B. Post. The new Exchange building at 18 Broad Street opened on April 22, 1903 to fanfare and festivity. The Exchange building is considered one of Post’s masterpieces and is a national landmark.

John Quincy Adams Ward, a prolific and well-known American sculptor, designed the pediment. Entitled “Integrity Protecting the Works of Man,” the classical design depicts the 22-foot figure of Integrity in the center, with Agriculture and Mining to her left and Science, Industry and Invention on her right, representing the sources of American prosperity. The waves on either extreme of the pediment symbolize the ocean-to-ocean influence of the Exchange. (In 1936, due to the combined effects of the statuary’s 90-ton weight, along with the ravages of pollution and flaws in the marble, the Exchange replaced the marble figures with lead-coated replicas weighing only 10 tons.)

Among the building’s many architectural marvels:

When it opened, the trading floor was one of the grandest spaces in the nation. It measures 109 by 140 feet and its marble walls rise 72 feet to meet the ornate gilt ceiling.

  • Window wall: The entire front of the building is made of glass, in effect forming one huge window that is 96 feet long and 50 feet high. Another window of the same size forms the New Street front.
  • Skylight: The trading floor is surmounted by a vast skylight, 30 feet square.
  • Air conditioning: The Stock Exchange building was one of the first structures in the world to employ it.
  • Annunciator boards on each end wall of the trading floor were used to page members. Over 24 miles of wiring were installed to run the boards.
  • The new building was notable for its many amenities, including dining rooms and an emergency hospital with an in-house physician.

Other NYSE Euronext New York Exchanges

NYSE Arca is a fully electronic stock exchange, trading more than 8,000 exchange-listed (Nasdaq included) equity securities. NYSE Arca’s trading platform links traders to multiple US market centers and provides customers with fast electronic execution and open, direct and anonymous market access. NYSE Arca’s distinct market structure and functionality delivers the advantages of both displayed and dark liquidity, significant transparency and tremendous speed and efficiency. The trading rules are based on price-time priority. In addition to the continuous trading during the day, NYSE Arca provides a fully automated, totally transparent opening auction and closing auction for all stocks. As a result of its superior speed and functionality, NYSE Arca has become the number-one venue in the US for listing and trading ETFs and other exchange traded products.

NYSE MKT completed its acquisition of the American Stock Exchange (MKT) in October 2008. Post-merger, the MKT equities business has been renamed NYSE MKT. Positioned to be the premier market for listing and trading of small- and micro- cap companies, its streamlined listing requirements and trading rules are suited to the size and business needs of these firms while ensuring investor transparency. As of end of 2010, more than 550 companies are listed.

ArcaEdge is a fast, efficient and fair platform to trade over-the-counter (OTC) stocks. ArcaEdge offers best-price executions based on liquidity, transparency, speed and anonymity. As an all-electronic matching system, ArcaEdge provides interactive, real-time display of the order book, best execution intelligent order routing tools, speed, consistency and reliability. ArcaEdge is a truly unique participant in today’s OTC equities marketplace and is the preeminent choice for better OTC executions.

Other Trading Facilities

NYSE Euronext’s include a growing portfolio of product and service offerings are our new bond market and our portfolio-based, point-in-time electronic exchange facility.

NYSE Bonds is an all-electronic platform that provides an efficient and transparent way to trade bonds, based on price-time priority.

The Bell

One of the most familiar features of the New York Stock Exchange is the loud, distinctive Trading Floor bell. "THE OPENING BELL℠" signals the beginning of trading each business day and "THE CLOSING BELL®" signals the ending of trading each business day.

Bells were introduced when continuous trading was instituted in the 1870s. Originally, a Chinese Gong was used, but brass bells have been used since the Exchange moved to its current location in 1903.
There is one large bell in each of the four trading areas of the NYSE. The bells are operated synchronously from a single control.

The G. S. Edwards Company of Norwalk, Connecticut manufactured the bells, measuring 18 inches in diameter. In the late 1980s, the NYSE decided to refurbish the bells and have an extra bell made as a backup. However, it was discovered that bells as large and loud as the Exchange’s were no longer made by Edwards or any other bell company. Edwards agreed to make a special replica for the NYSE and brought employees out of retirement to handle the job.
While this was being done, an older, larger bell was discovered in a crawl space above the main trading floor. Measuring 24 inches in diameter, this 1903 bell had most likely been put away because it was too loud, even for the New York Stock Exchange. After being cleaned and refurbished, this giant bell was toned down. It now gleams on a platform above the trading floor, ready for use should it ever be called into action.

The Trading Floor bell is a part of the NYSE's heritage, and it is considered an honor to be invited to ring  "THE  OPENING BELL℠" or "THE CLOSING BELL®".

NYSE Technology for the 21st Century

Much has changed since 1903, yet the NYSE has always kept pace with member and investor need for trading space and the latest developments in technology.

NYSE Technologies, the commercial technology division of NYSE Euronext, provides comprehensive transaction, data, infrastructure services and managed solutions for buy-side, sell-side and exchange communities.

NYSE operates four businesses: Global Market Data, which offers an array of global market information products covering multiple asset classes; Trading Solutions, which creates and implements high-performance end-to-end messaging software and real-time market data distribution and integration products; Exchange solutions, which provides multi-asset exchange platform services and consulting; and Global Connectivity, offering one of the world’s largest and most reliable financial transaction networks connecting firms and exchanges worldwide.