Stocks were first traded in the middle of the 18th century, but
there are records of trading activity dating as far back as the 11th
The early precursor to modern stock trading activity first took
place, and proliferated, in Western Europe. One of the first
known trading exchanges is the Paris Bourse in France during
the 12th century. Other ancestors of modern exchanges are the
Amsterdam Bourse in the Netherlands, the Deutsche Stock
Exchange in Frankfurt and the London Stock Exchange, all of
which became active trading centres shortly after the Paris
Other European exchanges opened in the 17th and 18th centuries,
including those in Belgium, Spain, Portugal and Sweden.
When those early exchanges started, stocks were extremely
uncommon, so the exchanges first specialised in commodities
The first exchange to formally begin trading stocks was
Amsterdam’s Bourse in 1785. Many other investors around the
world rapidly caught wind of the possibilities of the exchange
and trade of stocks, and by the mid-19th century many countries
outside of Europe were trading securities including the United
States, Canada and Australia.
Meanwhile, in the late 18th century, a group of brokers in
Philadelphia and New York City began to meet in parks and coffee
houses to buy and sell securities. These meetings looked like
open auctions, where traders called out names of companies and
numbers of shares available looking for the highest bidders.
With the end of the American Revolution at the end of the 18th
century, the number of securities made available increased dramatically
and brokers started to organise themselves so that they could handle the increased volume. In 1800, the Philadelphia
Board of Brokers drew up regulations and a constitution, and set
up central offices where trading could take place. This organisation
was eventually named the Philadelphia Stock Exchange,
which is the oldest exchange in the United States. A few years
later, in 1817, the New York Stock Exchange was formed.
As the United States and Europe grew and prospered during
the 19th century, dozens of exchanges were formed, some of
which are still in existence while others were short-lived. For
example, the California gold rush of 1849 gave birth to a number
of small exchanges where the public could buy shares of mining
companies from the area. However, as the gold rush subsided,
these California companies moved or went out of existence,
causing this California exchanges to go out of business as well.
During the second half of the 19th century, New York City
emerged as the primary financial centre of the United States.
Within New York, the NYSE (New York Stock Exchange)
became one of the most prosperous exchanges in the world,
where most of the largest corporations made their shares available
to traders and investors. Meanwhile, stocks of smaller companies
were still traded by brokers on the streets. In 1908 a
group of such brokers formed an organisation called the New
York Curb Agency, which later became known as the American
Stock Exchange or ASE in 1953.