Many millions of people — possibly half the population of the United States — have a personal interest in what happens on the stock exchange. Some are directly concerned because they are part owners of companies through stock; others are holders of government and other listed securities; and yet another group are holders of insurance policies and savings bank accounts, since banks and insurance companies invest much of their assets in listed securities.

A stock exchange is a market for the purchase and sale of securities, such as shares, stocks, and bonds. Such markets have existed for centuries. They had their beginnings in the regular meetings, usually in a coffeehouse or restaurant, of a few men who acted as intermediaries between buyers and sellers. They did this for a commission.

In London for example, the stockbrokers used to meet at Jonathan’s coffeehouse in Change Alley. In 1773 they moved to a room in Sweeting’s Alley to which they gave the name stock exchange.

In the United States, to pay for the cost of the Revolutionary War and to finance other activities, stocks and bonds had to be sold to the public. But the people didn’t want to invest in securities unless they could easily resell them. So a market place for securities was needed.

The brokers of that day decided to meet every day under the branches of an old buttonwood tree on Wall Street. These men were the 24 original members of the New York Stock – Exchange. Their trading floor was a small plot of ground protected by the branches of a tree — but that was the first stock exchange in the United States.

In other parts of the world, stock exchanges sprang up even earlier. The origin of the Paris Bourse, which means market, has been traced back to the money-changers market in the year 1138. In Amsterdam, the first exchange was founded in 1611.