Star InactiveStar InactiveStar InactiveStar InactiveStar Inactive

The trading market is a network of different economic transactions, also known under the name of an aggregation of buyers and sellers. But if it were to ask you when all started, would you know what to answer?

In the USA, the security market has started with speculative trading. The first stock exchange was established in 1791 in Philadelphia, a leader in both domestic and foreign trade. The next year another exchange was established in 1792. The principle behind it was simple, 24 brokers and merchants acted as agents for other persons in exchange of a commission. Most of the businesses were completed at 68 Wall Street. They had no office, they did their trades under a tree.

How did the trading market evolve?

Early trading was all about government securities. The volume of transactions grew because of the stocks, insurance companies and banks had. When the government started to build roads, more securities were brought to the market, so in 1817 the brokers from New York established the New York Stock and Exchange Board. It was a historic moment because from this point on, the stock market grew at pace with the industrialization of the states. At present, the market is called the American Stock Exchange, but its name was established in 1863.

Day trading is something everyone is talking about, but it’s not something new, it actually has been around for more than a century. Nowadays, we use tech to trade but the operations are created according to principles established in the 19th century. Trading was an important job for businesspeople back then, and they set their companies in the cities where they could trade. Their businesses were known under the name bucket shops because all the players contributed money to ensure that the business is running successfully. The funds were used to buy commodities or stocks with leverage. This option offered small traders the opportunity to speculate with stocks they couldn’t access another way.

Even if they didn’t have the technology then, the operations were completed fast, someone read the ticker tape and someone else listed the prices. While the ticker was read, businessmen closed deals and sold their stocks. The success of an operation was determined solely by the honesty of the shop operators. As you can expect many of the stores were illegal and unlicensed. However, these shops closed in 1929 because of the Stock Market Crash.

The Stock Market Crash determined the shape of the present trading market

The modern markets we are operating on nowadays were strictly regulated as exchanges in the 1930s. Today the main markets are the New York Stock Exchange, The American Stock Exchange, the Pacific Stock Exchange, The Philadelphia Stock Exchange, The Chicago Board of Trade, and the National Association of Securities Dealers Automated Quotation system, also known as NASDAQ. Alongside the trade markets from America, there are also foreign markets that regulate operations. The most important foreign exchanges are in London, Japan, Hong Kong, France, and Germany. Some markets trade stocks, while others are specialized in other operations like Forex trading, bonds, commodities, options, and futures. When interested to trade Forex people always consult a forum specialised in Forex trades because it offers them all the information they need to do it successfully.

The condition for a market to be created is similar items to be exchanged or traded. The operations we complete today in the trading market have their roots in the old agricultural marketplaces. But, even if it may sound surprising, in the countryside you can still find coastal city fish markets and farmers’ markets. They are the true example of how people managed to retail sales, and how they used to trade goods.

It’s important to note that the 1929 Crash and the Great Depression has a huge impact on the trading industry. After the 1929 crash, the Security and Exchange Commission instituted and it created regulations that prevent another crash. This commission was established by the congress in 1934 and its goal was to restore businessmen’s confidence after they used misleading sales practices for so many years. Stock manipulators were the reason behind the collapse of the stock market in 1929 and the regulations make sure something similar will never happen again. Nowadays people aren’t allowed to buy stocks or do any other type of trade if they don’t have the needed funds to pay for it. All the operations are supervised and controlled by stockbrokers and securities markets, everyone has to act according to an established set of rules, and information is at hand for anyone who wants to start a business in the industry.

At present, people can buy and sell from their own account, the condition is to collaborate with a broker who acts as an intermediary. The key to success is to specialize in a certain niche.