First Stock Ticker Debuts

First Stock Ticker Debuts


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On November 15, 1867, the first stock ticker is unveiled in New York City. The advent of the ticker ultimately revolutionized the stock market by making up-to-the-minute prices available to investors around the country. Prior to this development, information from the New York Stock Exchange, which has been around since 1792, traveled by mail or messenger.

The ticker was the brainchild of Edward Calahan, who configured a telegraph machine to print stock quotes on streams of paper tape (the same paper tape later used in ticker-tape parades). The ticker, which caught on quickly with investors, got its name from the sound its type wheel made.

The last mechanical stock ticker debuted in 1960 and was eventually replaced by computerized tickers with electronic displays. A ticker shows a stock’s symbol, how many shares have traded that day and the price per share. It also tells how much the price has changed from the previous day’s closing price and whether it’s an up or down change. A common misconception is that there is one ticker used by everyone. In fact, private data companies run a variety of tickers; each provides information about a select mix of stocks.

READ MORE: Wall Street Timeline


Ticker symbol

A ticker symbol or stock symbol is an abbreviation used to uniquely identify publicly traded shares of a particular stock on a particular stock market. A stock symbol may consist of letters, numbers or a combination of both. "Ticker symbol" refers to the symbols that were printed on the ticker tape of a ticker tape machine.


Thomas A. Edison Papers

Edison did not invent the stock ticker. The credit for that invention goes to Edward Calahan who devised the first stock ticker in 1867 for the Gold and Stock Telegraph Company in New York. Edison developed his Universal Stock Printer in 1871 for Gold and Stock, which soon became a subsidiary of Western Union. Edison's improved stock ticker included his key contributions to printing telegraphy. His most significant improvement was a mechanism that enabled all of the tickers on a line to be synchronized so that they printed the same information. Because the printers frequently fell behind the transmitter by one or more letters, exchange companies had to send employees to the offices where printers were running out of "unison" to reset them. This led to the development of automatic mechanical means to solve the problem.

One of the most effective and longest used devices was Edison's screw-thread unison. With Edison's device the transmitting operator could bring all the printers on a line into unison by sending electrical impulses to turn the shaft of each machine until a peg sitting in a screw-thread on the typewheel hit a stop. Edison also designed an improved typewheel-shifting mechanism and a paper feed so that his ticker required much less battery power. Edison also devised a transmitter for his stock ticker that used a keyboard like that of a typewriter. Edison's ticker was used on the stock exchange for several years before being replaced, but it continued to be used until about 1960 for many other purposes, including the transmission of sports scores.


Squarespace stock sputters in public debut

Squarespace CEO Anthony Casalena

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Referenced Symbols

Squarespace Inc. shares opened 4% below their reference price as the web-design company made its public debut.

The stock’s SQSP, -0.13% first trade was for $48 a share at 1:19 p.m. ET Wednesday, below the reference price of $50 that was set in conjunction with the company’s direct listing. Shares recently changed hands at $49.66.

Because Squarespace held a direct listing, it didn’t raise new funds through the process of going public. Wednesday’s trading action puts Squarespace on track to close the day with a market value of about $6.8 billion, below the $10 billion private-market valuation it fetched after a March funding round.

Squarespace makes technology that enables businesses and individuals to set up websites with storefronts, email-marketing, and other capabilities. The company saw benefits during the pandemic as more small businesses moved to establish themselves on the web.

The company believes that building for the web has become “democratized” with tools like Squarespace “rapidly displacing expensive agencies” by making it easy for people with little web expertise to design and manage sites, according to Squarespace’s prospectus.

Squarespace generated $621 million in revenue last year, up from $485 million a year prior. It was also profitable in 2020, posting net income of $30.6 million, below the $58.2 million it recorded a year earlier.

The company had 3.7 million unique subscriptions as of the end of last year and generated 94% of its revenue from subscriptions.

It sees opportunities to further expand the customer base, particularly in international markets, and to build out its enterprise capabilities so that it can better appeal to larger businesses.

Squarespace’s direct listing comes as the Renaissance IPO ETF IPO, +0.70% has lost about 12% so far this year and as the S&P 500 SPX, +0.58% has risen 9% in the same span.


Contents

The earliest recorded organization of securities trading in New York among brokers directly dealing with each other can be traced to the Buttonwood Agreement. Previously, securities exchange had been intermediated by the auctioneers, who also conducted more mundane auctions of commodities such as wheat and tobacco. [9] On May 17, 1792, twenty four brokers signed the Buttonwood Agreement, which set a floor commission rate charged to clients and bound the signers to give preference to the other signers in securities sales. The earliest securities traded were mostly governmental securities such as War Bonds from the Revolutionary War and First Bank of the United States stock, [9] although Bank of New York stock was a non-governmental security traded in the early days. [10] The Bank of North America, along with the First Bank of the United States and the Bank of New York, were the first shares traded on the New York Stock Exchange. [11]

In 1817, the stockbrokers of New York, operating under the Buttonwood Agreement, instituted new reforms and reorganized. After sending a delegation to Philadelphia to observe the organization of their board of brokers, restrictions on manipulative trading were adopted, as well as formal organs of governance. [9] After re-forming as the New York Stock and Exchange Board, the broker organization began renting out space exclusively for securities trading, which previously had been taking place at the Tontine Coffee House. Several locations were used between 1817 and 1865, when the present location was adopted. [9]

The invention of the electrical telegraph consolidated markets and New York's market rose to dominance over Philadelphia after weathering some market panics better than other alternatives. [9] The Open Board of Stock Brokers was established in 1864 as a competitor to the NYSE. With 354 members, the Open Board of Stock Brokers rivaled the NYSE in membership (which had 533) "because it used a more modern, continuous trading system superior to the NYSE’s twice-daily call sessions". The Open Board of Stock Brokers merged with the NYSE in 1869. Robert Wright of Bloomberg writes that the merger increased the NYSE's members as well as trading volume, as "several dozen regional exchanges were also competing with the NYSE for customers. Buyers, sellers and dealers all wanted to complete transactions as quickly and cheaply as technologically possible and that meant finding the markets with the most trading, or the greatest liquidity in today’s parlance. Minimizing competition was essential to keep a large number of orders flowing, and the merger helped the NYSE maintain its reputation for providing superior liquidity." [12] The Civil War greatly stimulated speculative securities trading in New York. By 1869, membership had to be capped, and has been sporadically increased since. The latter half of the nineteenth century saw rapid growth in securities trading. [13]

Securities trade in the latter nineteenth and early twentieth centuries was prone to panics and crashes. Government regulation of securities trading was eventually seen as necessary, with arguably the most dramatic changes occurring in the 1930s after a major stock market crash precipitated the Great Depression. The NYSE has also imposed additional rules in response to shareholder protection controls, e.g. in 2012, the NYSE imposed rules restricting brokers from voting uninstructed shares. [14] : 2

The Stock Exchange Luncheon Club was situated on the seventh floor from 1898 until its closure in 2006. [15]

On April 21, 2005, the NYSE announced its plans to merge with Archipelago in a deal intended to reorganize the NYSE as a publicly traded company. NYSE's governing board voted to merge with rival Archipelago on December 6, 2005, and became a for-profit, public company. It began trading under the name NYSE Group on March 8, 2006. On April 4, 2007, the NYSE Group completed its merger with Euronext, the European combined stock market, thus forming NYSE Euronext, the first transatlantic stock exchange.

Wall Street is the leading US money center for international financial activities and the foremost US location for the conduct of wholesale financial services. "It comprises a matrix of wholesale financial sectors, financial markets, financial institutions, and financial industry firms" (Robert, 2002). The principal sectors are securities industry, commercial banking, asset management, and insurance.

Prior to the acquisition of NYSE Euronext by the ICE in 2013, Marsh Carter was the Chairman of the NYSE and the CEO was Duncan Niederauer. Currently, [ when? ] the chairman is Jeffrey Sprecher. [16] In 2016, NYSE owner Intercontinental Exchange Inc. earned $419 million in listings-related revenues. [17]

Notable events Edit

20th century Edit

The exchange was closed shortly after the beginning of World War I (July 31, 1914), but it partially re-opened on November 28 of that year in order to help the war effort by trading bonds, [18] and completely reopened for stock trading in mid-December.

On September 16, 1920, the Wall Street bombing occurred outside the building, killing thirty-eight people and injuring hundreds more. [19] [20] [21]

The Black Thursday crash of the Exchange on October 24, 1929, and the sell-off panic which started on Black Tuesday, October 29, are often blamed for precipitating the Great Depression. In an effort to restore investor confidence, the Exchange unveiled a fifteen-point program aimed to upgrade protection for the investing public on October 31, 1938.

On October 1, 1934, the exchange was registered as a national securities exchange with the U.S. Securities and Exchange Commission, with a president and a thirty-three-member board. On February 18, 1971, the non-profit corporation was formed, and the number of board members was reduced to twenty-five.

One of Abbie Hoffman's well-known publicity stunts took place in 1967, when he led members of the Yippie movement to the Exchange's gallery. The provocateurs hurled fistfuls of dollars toward the trading floor below. Some traders booed, and some laughed and waved. Three months later the stock exchange enclosed the gallery with bulletproof glass. [22] Hoffman wrote a decade later, "We didn't call the press at that time we really had no notion of anything called a media event." [23]

On October 19, 1987, the Dow Jones Industrial Average (DJIA) dropped 508 points, a 22.6% loss in a single day, the second-biggest one-day drop the exchange had experienced. Black Monday was followed by Terrible Tuesday, a day in which the Exchange's systems did not perform well and some people had difficulty completing their trades. [24]

Subsequently, there was another major drop for the Dow on October 13, 1989—the Mini-Crash of 1989. The crash was apparently caused by a reaction to a news story of a $6.75 billion leveraged buyout deal for UAL Corporation, the parent company of United Airlines, which broke down. When the UAL deal fell through, it helped trigger the collapse of the junk bond market causing the Dow to fall 190.58 points, or 6.91 percent.

Similarly, there was a panic in the financial world during the year of 1997 the Asian Financial Crisis. Like the fall of many foreign markets, the Dow suffered a 7.18% drop in value (554.26 points) on October 27, 1997, in what later became known as the 1997 Mini-Crash but from which the DJIA recovered quickly. This was the first time that the "circuit breaker" rule had operated.

21st century Edit

On January 26, 2000, an altercation during filming of the music video for Rage Against the Machine's "Sleep Now in the Fire", directed by Michael Moore, caused the doors of the exchange to be closed and the band to be escorted from the site by security [25] after the members attempted to gain entry into the exchange.

In the aftermath of the September 11 attacks, the NYSE was closed for four trading sessions, resuming on Monday, September 17, one of the rare times the NYSE was closed for more than one session and only the third time since March 1933. On the first day, the NYSE suffered a 7.1% drop in value (684 points) after a week, it dropped by 14% (1,370 points). An estimated $1.4 trillion was lost within five days of trading. [26] The NYSE was only 5 blocks from Ground Zero.

On May 6, 2010, the Dow Jones Industrial Average posted its largest intraday percentage drop since the crash on October 19, 1987, with a 998-point loss later being called the 2010 Flash Crash (as the drop occurred in minutes before rebounding). The SEC and CFTC published a report on the event, although it did not come to a conclusion as to the cause. The regulators found no evidence that the fall was caused by erroneous ("fat finger") orders. [27]

On October 29, 2012, the stock exchange was shut down for two days due to Hurricane Sandy. [28] The last time the stock exchange was closed due to weather for a full two days was on March 12 and 13, 1888. [29]

On May 1, 2014, the stock exchange was fined $4.5 million by the Securities and Exchange Commission to settle charges that it had violated market rules. [30]

On August 14, 2014, Berkshire Hathaway's A Class shares, the highest priced shares on the NYSE, hit $200,000 a share for the first time. [31]

On July 8, 2015, technical issues affected the stock exchange, halting trading at 11:32 am ET. The NYSE reassured stock traders that the outage was "not a result of a cyber breach", and the Department of Homeland Security confirmed that there was "no sign of malicious activity". [32] Trading eventually resumed at 3:10 pm ET the same day.

On May 25, 2018, Stacey Cunningham, the NYSE's chief operating officer, became the Big Board's 67th president, succeeding Thomas Farley. [33] She is the first female leader in the exchange's 226-year history.

In March 2020, the NYSE announced plans to temporarily move to all-electronic trading on March 23, 2020, due to the COVID-19 pandemic in New York City. [34] The NYSE reopened on May 26, 2020. [35]

The main New York Stock Exchange Building, built in 1903, is at 18 Broad Street, between the corners of Wall Street and Exchange Place, and was designed in the Beaux Arts style by George B. Post. [36] The adjacent structure at 11 Wall Street, completed in 1922, was designed in a similar style by Trowbridge & Livingston. The buildings were both designated a National Historic Landmark in 1978. [37] [38] [39] 18 Broad Street is also a New York City designated landmark. [40]

The New York Stock Exchange is closed on New Year's Day, Martin Luther King, Jr. Day, Washington's Birthday, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving, and Christmas. When those holidays occur on a weekend, the holiday is observed on the closest weekday. In addition, the Stock Exchange closes early on the day before Independence Day, the day after Thanksgiving, and Christmas Eve. [41] The NYSE averages about 253 trading days per year.

The New York Stock Exchange (sometimes referred to as "The Big Board") provides a means for buyers and sellers to trade shares of stock in companies registered for public trading. The NYSE is open for trading Monday through Friday from 9:30 am – 4:00 pm ET, with the exception of holidays declared by the Exchange in advance.

The NYSE trades in a continuous auction format, where traders can execute stock transactions on behalf of investors. They will gather around the appropriate post where a specialist broker, who is employed by a NYSE member firm (that is, he/she is not an employee of the New York Stock Exchange), acts as an auctioneer in an open outcry auction market environment to bring buyers and sellers together and to manage the actual auction. They do on occasion (approximately 10% of the time) facilitate the trades by committing their own capital and as a matter of course disseminate information to the crowd that helps to bring buyers and sellers together. The auction process moved toward automation in 1995 through the use of wireless handheld computers (HHC). The system enabled traders to receive and execute orders electronically via wireless transmission. On September 25, 1995, NYSE member Michael Einersen, who designed and developed this system, executed 1000 shares of IBM through this HHC ending a 203-year process of paper transactions and ushering in an era of automated trading.

As of January 24, 2007, all NYSE stocks can be traded via its electronic hybrid market (except for a small group of very high-priced stocks). Customers can now send orders for immediate electronic execution, or route orders to the floor for trade in the auction market. In the first three months of 2007, in excess of 82% of all order volume was delivered to the floor electronically. [42] NYSE works with US regulators such as the SEC and CFTC to coordinate risk management measures in the electronic trading environment through the implementation of mechanisms like circuit breakers and liquidity replenishment points. [43]

Until 2005, the right to directly trade shares on the exchange was conferred upon owners of the 1,366 "seats". The term comes from the fact that up until the 1870s NYSE members sat in chairs to trade. In 1868, the number of seats was fixed at 533, and this number was increased several times over the years. In 1953, the number of seats was set at 1,366. These seats were a sought-after commodity as they conferred the ability to directly trade stock on the NYSE, and seat holders were commonly referred to as members of the NYSE. The Barnes family is the only known lineage to have five generations of NYSE members: Winthrop H. Barnes (admitted 1894), Richard W.P. Barnes (admitted 1926), Richard S. Barnes (admitted 1951), Robert H. Barnes (admitted 1972), Derek J. Barnes (admitted 2003). Seat prices varied widely over the years, generally falling during recessions and rising during economic expansions. The most expensive inflation-adjusted seat was sold in 1929 for $625,000, which, today, would be over six million dollars. In recent times, seats have sold for as high as $4 million in the late 1990s and as low as $1 million in 2001. In 2005, seat prices shot up to $3.25 million as the exchange entered into an agreement to merge with Archipelago and became a for-profit, publicly traded company. Seat owners received $500,000 in cash per seat and 77,000 shares of the newly formed corporation. The NYSE now sells one-year licenses to trade directly on the exchange. Licenses for floor trading are available for $40,000 and a license for bond trading is available for as little as $1,000 as of 2010. [44] Neither are resell-able, but may be transferable during a change of ownership of a corporation holding a trading license.

Following the Black Monday market crash in 1987, NYSE imposed trading curbs to reduce market volatility and massive panic sell-offs. Following the 2011 rule change, at the start of each trading day, the NYSE sets three circuit breaker levels at levels of 7% (Level 1), 13% (Level 2), and 20% (Level 3) of the average closing price of the S&P 500 for the preceding trading day. Level 1 and Level 2 declines result in a 15-minute trading halt unless they occur after 3:25 pm, when no trading halts apply. A Level 3 decline results in trading being suspended for the remainder of the day. [45] (The biggest one-day decline in the S&P 500 since 1987 was the 11.98% drop on March 16, 2020.)

NYSE Composite Index Edit

In the mid-1960s, the NYSE Composite Index (NYSE: NYA) was created, with a base value of 50 points equal to the 1965 yearly close. [46] This was done to reflect the value of all stocks trading at the exchange instead of just the 30 stocks included in the Dow Jones Industrial Average. To raise the profile of the composite index, in 2003, the NYSE set its new base value of 5,000 points equal to the 2002 yearly close. Its close at the end of 2013 was 10,400.32.

Timeline Edit

  • In 1792, NYSE acquires its first traded securities. [47][48]
  • In 1817, the constitution of the New York Stock and Exchange Board is adopted. It had also been established by the New York brokers as a formal organization. [49]
  • In 1863, the name changed to the New York Stock Exchange.
  • In 1865, the New York Gold Exchange was acquired by the NYSE. [50]
  • In 1867, stock tickers were first introduced. [51]
  • In 1885, the 400 NYSE members in the Consolidated Stock Exchange withdraw from Consolidated over disagreements on exchange trade areas. [52]
  • In 1896, the Dow Jones Industrial Average (DJIA) is first published in The Wall Street Journal. [51]
  • In 1903, the NYSE moves into new quarters at 18 Broad Street.
  • In 1906, the DJIA exceeds 100 on January 12.
  • In 1907, Panic of 1907.
  • In 1909, trading in bonds begins.
  • In 1915, basis of quoting and trading in stocks changes from percent of par value to dollars.
  • In 1920, a bomb exploded on Wall Street outside the NYSE building. Thirty-eight killed and hundreds injured.
  • In 1923, Poor's Publishing introduced their "Composite Index", today referred to as the S&P 500, which tracked a small number of companies on the NYSE. [53]
  • In 1929, the central quote system was established Black Thursday, October 24 and Black Tuesday, October 29 signal the end of the Roaring Twenties bull market.
  • In 1938, NYSE names its first president.
  • In 1943, trading floor is opened to women while men were serving in WWII. [54]
  • In 1949, the third longest (eight-year) bull market begins. [55]
  • In 1954, the DJIA surpasses its 1929 peak in inflation-adjusted dollars.
  • In 1956, the DJIA closes above 500 for the first time on March 12.
  • In 1957, after Poor's Publishing merged with the Standard Statistics Bureau, the Standard & Poors composite index grew to track 500 companies on the NYSE, becoming known as the S&P 500. [53]
  • In 1966, NYSE begins a composite index of all listed common stocks. This is referred to as the "Common Stock Index" and is transmitted daily. The starting point of the index is 50. It is later renamed the NYSE Composite Index. [56]
  • In 1967, Muriel Siebert becomes the first female member of the New York Stock Exchange. [57]
  • In 1967, protesters led by Abbie Hoffman throw mostly fake dollar bills at traders from gallery, leading to the installation of bullet-proof glass.
  • In 1970, the Securities Investor Protection Corporation was established.
  • In 1971, NYSE incorporated and recognized as Not-for-Profit organization. [56]
  • In 1971, the NASDAQ was founded and competes with the NYSE as the world's first electronic stock market. [58] To date, the NASDAQ is the second-largest exchange in the world by market capitalization, behind only the NYSE. [59]
  • In 1972, the DJIA closes above 1,000 for the first time on November 14.
  • In 1977, foreign brokers are admitted to NYSE.
  • In 1980, the New York Futures Exchange was established.
  • In 1987, Black Monday, October 19, sees the second-largest one-day DJIA percentage drop (22.6%, or 508 points) in history.
  • In 1987, membership in the NYSE reaches a record price of $1.5 million.
  • In 1989, On September 14, seven members of ACT-UP, The AIDS Coalition to Unleash Power, entered the NYSE and protested by chaining themselves to the balcony overlooking the trading floor and unfurling a banner, "SELL WELCOME," in reference to drug manufacturer Burroughs Wellcome. Following the protest, Burroughs Wellcome reduced the price of AZT (a drug used by people with living with HIV and AIDS) by over 30%. [60]
  • In 1990, the longest (ten-year) bull market begins. [55]
  • In 1991, the DJIA exceeds 3,000.
  • In 1995, the DJIA exceeds 5,000.
  • In 1996, real-time ticker introduced. [61]
  • In 1997, on October 27, a sell-off in Asia's stock markets hurts the U.S. markets as well DJIA sees the largest one-day point drop of 554 (or 7.18%) in history. [62]
  • In 1999, the DJIA exceeds 10,000 on March 29.
  • In 2000, the DJIA peaks at 11,722.98 on January 14 first NYSE global index is launched under the ticker NYIID.

In 2020, the NYSE temporarily transitioned to electronic trading due to the COVID-19 pandemic. [67]

Merger, acquisition, and control Edit

In October 2008, NYSE Euronext completed acquisition of the American Stock Exchange (AMEX) for $260 million in stock. [68]

On February 15, 2011, NYSE and Deutsche Börse announced their merger to form a new company, as yet unnamed, wherein Deutsche Börse shareholders would have 60% ownership of the new entity, and NYSE Euronext shareholders would have 40%.

On February 1, 2012, the European Commission blocked the merger of NYSE with Deutsche Börse, after commissioner Joaquín Almunia stated that the merger "would have led to a near-monopoly in European financial derivatives worldwide". [69] Instead, Deutsche Börse and NYSE would have to sell either their Eurex derivatives or LIFFE shares in order to not create a monopoly. On February 2, 2012, NYSE Euronext and Deutsche Börse agreed to scrap the merger. [70]

In April 2011, Intercontinental Exchange (ICE), an American futures exchange, and NASDAQ OMX Group had together made an unsolicited proposal to buy NYSE Euronext for approximately US$11,000,000,000, a deal in which NASDAQ would have taken control of the stock exchanges. [71] NYSE Euronext rejected this offer twice, but it was finally terminated after the United States Department of Justice indicated their intention to block the deal due to antitrust concerns. [71]

In December 2012, ICE had proposed to buy NYSE Euronext in a stock swap with a valuation of $8 billion. [8] [71] NYSE Euronext shareholders would receive either $33.12 in cash, or $11.27 in cash and approximately a sixth of a share of ICE. Jeffrey Sprecher, the chairman and CEO of ICE, will retain those positions, but four members of the NYSE board of directors will be added to the ICE board. [8]

The NYSE's opening and closing bells mark the beginning and the end of each trading day. The opening bell is rung at 9:30 am ET to mark the start of the day's trading session. At 4 pm ET the closing bell is rung and trading for the day stops. There are bells located in each of the four main sections of the NYSE that all ring at the same time once a button is pressed. [72] There are three buttons that control the bells, located on the control panel behind the podium which overlooks the trading floor. The main bell, which is rung at the beginning and end of the trading day, is controlled by a green button. The second button, colored orange, activates a single-stroke bell that is used to signal a moment of silence. A third, red button controls a backup bell which is used in case the main bell fails to ring. [73]

History Edit

The signal to start and stop trading was not always a bell. The original signal was a gavel (which is still in use today along with the bell), but during the late 1800s, the NYSE decided to switch the gavel for a gong to signal the day's beginning and end. After the NYSE changed to its present location at 18 Broad Street in 1903, the gong was switched to the bell format that is currently being used.

A common sight today is the highly publicized events in which a celebrity or executive from a corporation stands behind the NYSE podium and pushes the button that signals the bells to ring. Due to the amount of coverage that the opening/closing bells receive, many companies coordinate new product launches and other marketing-related events to start on the same day as when the company's representatives ring the bell. It was only in 1995 that the NYSE began having special guests ring the bells on a regular basis prior to that, ringing the bells was usually the responsibility of the exchange's floor managers. [72]

Notable bell-ringers Edit

Many of the people who ring the bell are business executives whose companies trade on the exchange. However, there have also been many famous people from outside the world of business that have rung the bell. Athletes such as Joe DiMaggio of the New York Yankees and Olympic swimming champion Michael Phelps, entertainers such as rapper Snoop Dogg, members of ESPN’s College GameDay crew, singer and actress Liza Minnelli [74] and members of the band Kiss, and politicians such as Mayor of New York City Rudy Giuliani and President of South Africa Nelson Mandela have all had the honor of ringing the bell. Two United Nations Secretaries General have also rung the bell. On April 27, 2006, Secretary-General Kofi Annan rang the opening bell to launch the United Nations Principles for Responsible Investment. [75] On July 24, 2013, Secretary-General Ban Ki-moon rang the closing bell to celebrate the NYSE joining the United Nations Sustainable Stock Exchanges Initiative. [76]

In addition, there have been many bell-ringers who are famous for heroic deeds, such as members of the New York police and fire departments following the events of 9/11, members of the United States Armed Forces serving overseas, and participants in various charitable organizations.

There have also been several fictional characters that have rung the bell, including Mickey Mouse, the Pink Panther, Mr. Potato Head, the Aflac Duck, Gene of The Emoji Movie, [77] and Darth Vader. [78]


First stock ticker debuts - Nov 15, 1867 - HISTORY.com

TSgt Joe C.

On this day in 1867, the first stock ticker is unveiled in New York City. The advent of the ticker ultimately revolutionized the stock market by making up-to-the-minute prices available to investors around the country. Prior to this development, information from the New York Stock Exchange, which has been around since 1792, traveled by mail or messenger.

The ticker was the brainchild of Edward Calahan, who configured a telegraph machine to print stock quotes on streams of paper tape (the same paper tape later used in ticker-tape parades). The ticker, which caught on quickly with investors, got its name from the sound its type wheel made.

Calahan worked for the Gold & Stock Telegraph Company, which rented its tickers to brokerage houses and regional exchanges for a fee and then transmitted the latest gold and stock prices to all its machines at the same time. In 1869, Thomas Edison, a former telegraph operator, patented an improved, easier-to-use version of Calahan’s ticker. Edison’s ticker was his first lucrative invention and, through the manufacture and sale of stock tickers and other telegraphic devices, he made enough money to open his own lab in Menlo Park, New Jersey, where he developed the light bulb and phonograph, among other transformative inventions.

The last mechanical stock ticker debuted in 1960 and was eventually replaced by computerized tickers with electronic displays. A ticker shows a stock’s symbol, how many shares have traded that day and the price per share. It also tells how much the price has changed from the previous day’s closing price and whether it’s an up or down change. A common misconception is that there is one ticker used by everyone. In fact, private data companies run a variety of tickers each provides information about a select mix of stocks.


First Internet Bancorp (INBK)

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First Internet (INBK) has been upgraded to a Zacks Rank #1 (Strong Buy), reflecting growing optimism about the company's earnings prospects. This might drive the stock higher in the near term.

Top Ranked Value Stocks to Buy for May 10th

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First Internet Bank Expands SBA Team

First Internet Bank welcomes Samuel Criales, Thomas Hurdman, Laurel McNamara and Ben Woodward to its Small Business Administration (SBA) Lending team as Senior Business Development Officers.

Top Ranked Value Stocks to Buy for April 27th

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First Internet Bank Commits $250,000 to Hamilton County Community Foundation

First Internet Bank announced today a contribution of $250,000 to the Hamilton County Community Foundation unrestricted endowment which will be awarded to not-for-profit organizations in the area. Through a 2:1 match with Lilly Endowment’s Giving Indiana Funds for Tomorrow (GIFT) VII Initiative – increasing the total commitment to $750,000 – these funds will help address the most critical needs of Hamilton County residents now and in the future.

First Internet Bancorp (INBK) Q1 2021 Earnings Call Transcript

Good day, everyone and thank you for joining us to discuss First Internet Bancorp's financial results for the first quarter of 2021. The company issued its earnings press release yesterday afternoon and it's available on the company's website at www.firstinternetbancorp.com.

First Internet Bancorp (INBK) Tops Q1 Earnings Estimates

First Internet (INBK) delivered earnings and revenue surprises of 15.38% and -2.82%, respectively, for the quarter ended March 2021. Do the numbers hold clues to what lies ahead for the stock?

First Internet Bancorp Reports First Quarter 2021 Results

First Internet Bancorp (the "Company") (Nasdaq: INBK), the parent company of First Internet Bank (the "Bank"), announced today financial and operational results for the first quarter of 2021. Net income for the first quarter of 2021 was $10.5 million, or $1.05 diluted earnings per share. This compares to net income of $11.1 million, or $1.12 diluted earnings per share, for the fourth quarter of 2020, and net income of $6.0 million, or .62 diluted earnings per share, for the first quarter of 2020.

First Internet Bancorp (INBK) Earnings Expected to Grow: Should You Buy?

First Internet (INBK) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

First Internet Bancorp to Announce First Quarter 2021 Financial Results on Wednesday, April 21

First Internet Bancorp (the "Company") (Nasdaq: INBK), the parent company of First Internet Bank (www.firstib.com), announced today that it plans to issue its first quarter 2021 financial results after the market close on Wednesday, April 21, 2021.

First Internet Bank Selected for FedNow Service Pilot Program

First Internet Bank today announced its participation in a pilot program for the FedNow Service, the Federal Reserve’s instant payments network. This collaboration further evidences a commitment to digital banking and faster payments on the part of First Internet Bank, the nation’s first state chartered, FDIC-insured institution to operate entirely online.

Need To Know: Analysts Are Much More Bullish On First Internet Bancorp (NASDAQ:INBK) Revenues

Celebrations may be in order for First Internet Bancorp ( NASDAQ:INBK ) shareholders, with the analysts delivering a.


Flying tourists begins next year

With a price tag of $250,000 per person, Virgin Galactic plans to carry as many as six passengers in its spacecraft at a time. Flown by two pilots, spaceship is dropped from a jet-powered aircraft and fires a rocket motor, reaching over three times the speed of sound as it climbs though the Earth's atmosphere. Then the spacecraft and its passengers float weightless for a few minutes, before gliding back down to land on Earth much like a traditional aircraft.

After years of delays, Virgin Galactic is in the final stages of testing its spacecraft. The company has a list of 603 customers who have paid deposits, some of whom have been waiting for a decade for their chance to fly.

"Because it's taken so long to get this far I try not to think about the fact that we're almost there because I have thought about that for a few years," Branson told CNBC earlier this month.

The company plans to begin flying commercial flights in 2020.


Contents

The total market capitalization of equity backed securities worldwide rose from US$2.5 trillion in 1980 to US$68.65 trillion at the end of 2018. [1] As of December 31, 2019, the total market capitalization of all stocks worldwide was approximately US$70.75 trillion. [1]

As of 2016 [update] , there are 60 stock exchanges in the world. Of these, there are 16 exchanges with a market capitalization of $1 trillion or more, and they account for 87% of global market capitalization. Apart from the Australian Securities Exchange, these 16 exchanges are all in either North America, Europe, or Asia. [2]

By country, the largest stock markets as of January 2020 are in the United States of America (about 54.5%), followed by Japan (about 7.7%) and the United Kingdom (about 5.1%). [3]

A stock exchange is an exchange (or bourse) [note 1] where stockbrokers and traders can buy and sell shares (equity stock), bonds, and other securities. Many large companies have their stocks listed on a stock exchange. This makes the stock more liquid and thus more attractive to many investors. The exchange may also act as a guarantor of settlement. These and other stocks may also be traded "over the counter" (OTC), that is, through a dealer. Some large companies will have their stock listed on more than one exchange in different countries, so as to attract international investors. [6]

Stock exchanges may also cover other types of securities, such as fixed-interest securities (bonds) or (less frequently) derivatives, which are more likely to be traded OTC.

Trade in stock markets means the transfer (in exchange for money) of a stock or security from a seller to a buyer. This requires these two parties to agree on a price. Equities (stocks or shares) confer an ownership interest in a particular company.

Participants in the stock market range from small individual stock investors to larger investors, who can be based anywhere in the world, and may include banks, insurance companies, pension funds and hedge funds. Their buy or sell orders may be executed on their behalf by a stock exchange trader.

Some exchanges are physical locations where transactions are carried out on a trading floor, by a method known as open outcry. This method is used in some stock exchanges and commodities exchanges, and involves traders shouting bid and offer prices. The other type of stock exchange has a network of computers where trades are made electronically. An example of such an exchange is the NASDAQ.

A potential buyer bids a specific price for a stock, and a potential seller asks a specific price for the same stock. Buying or selling at the Market means you will accept any ask price or bid price for the stock. When the bid and ask prices match, a sale takes place, on a first-come, first-served basis if there are multiple bidders at a given price.

The purpose of a stock exchange is to facilitate the exchange of securities between buyers and sellers, thus providing a marketplace. The exchanges provide real-time trading information on the listed securities, facilitating price discovery.

The New York Stock Exchange (NYSE) is a physical exchange, with a hybrid market for placing orders electronically from any location as well as on the trading floor. Orders executed on the trading floor enter by way of exchange members and flow down to a floor broker, who submits the order electronically to the floor trading post for the Designated market maker ("DMM") for that stock to trade the order. The DMM's job is to maintain a two-sided market, making orders to buy and sell the security when there are no other buyers or sellers. If a bid–ask spread exists, no trade immediately takes place – in this case the DMM may use their own resources (money or stock) to close the difference. Once a trade has been made, the details are reported on the "tape" and sent back to the brokerage firm, which then notifies the investor who placed the order. Computers play an important role, especially for program trading.

The NASDAQ is an electronic exchange, where all of the trading is done over a computer network. The process is similar to the New York Stock Exchange. One or more NASDAQ market makers will always provide a bid and ask the price at which they will always purchase or sell 'their' stock.

The Paris Bourse, now part of Euronext, is an order-driven, electronic stock exchange. It was automated in the late 1980s. Prior to the 1980s, it consisted of an open outcry exchange. Stockbrokers met on the trading floor of the Palais Brongniart. In 1986, the CATS trading system was introduced, and the order matching system was fully automated.

People trading stock will prefer to trade on the most popular exchange since this gives the largest number of potential counter parties (buyers for a seller, sellers for a buyer) and probably the best price. However, there have always been alternatives such as brokers trying to bring parties together to trade outside the exchange. Some third markets that were popular are Instinet, and later Island and Archipelago (the latter two have since been acquired by Nasdaq and NYSE, respectively). One advantage is that this avoids the commissions of the exchange. However, it also has problems such as adverse selection. [7] Financial regulators have probed dark pools. [8] [9]

Market participants include individual retail investors, institutional investors (e.g., pension funds, insurance companies, mutual funds, index funds, exchange-traded funds, hedge funds, investor groups, banks and various other financial institutions), and also publicly traded corporations trading in their own shares. Robo-advisors, which automate investment for individuals are also major participants.

Demographics of market participation Edit

Indirect vs. Direct Investment Edit

Indirect investment involves owning shares indirectly, such as via a mutual fund or an exchange traded fund. Direct investment involves direct ownership of shares. [10]

Direct ownership of stock by individuals rose slightly from 17.8% in 1992 to 17.9% in 2007, with the median value of these holdings rising from $14,778 to $17,000. [11] [12] Indirect participation in the form of retirement accounts rose from 39.3% in 1992 to 52.6% in 2007, with the median value of these accounts more than doubling from $22,000 to $45,000 in that time. [11] [12] Rydqvist, Spizman, and Strebulaev attribute the differential growth in direct and indirect holdings to differences in the way each are taxed in the United States. Investments in pension funds and 401ks, the two most common vehicles of indirect participation, are taxed only when funds are withdrawn from the accounts. Conversely, the money used to directly purchase stock is subject to taxation as are any dividends or capital gains they generate for the holder. In this way the current tax code incentivizes individuals to invest indirectly. [13]

Participation by income and wealth strata Edit

Rates of participation and the value of holdings differ significantly across strata of income. In the bottom quintile of income, 5.5% of households directly own stock and 10.7% hold stocks indirectly in the form of retirement accounts. [12] The top decile of income has a direct participation rate of 47.5% and an indirect participation rate in the form of retirement accounts of 89.6%. [12] The median value of directly owned stock in the bottom quintile of income is $4,000 and is $78,600 in the top decile of income as of 2007. [14] The median value of indirectly held stock in the form of retirement accounts for the same two groups in the same year is $6,300 and $214,800 respectively. [14] Since the Great Recession of 2008 households in the bottom half of the income distribution have lessened their participation rate both directly and indirectly from 53.2% in 2007 to 48.8% in 2013, while over the same period households in the top decile of the income distribution slightly increased participation 91.7% to 92.1%. [15] The mean value of direct and indirect holdings at the bottom half of the income distribution moved slightly downward from $53,800 in 2007 to $53,600 in 2013. [15] In the top decile, mean value of all holdings fell from $982,000 to $969,300 in the same time. [15] The mean value of all stock holdings across the entire income distribution is valued at $269,900 as of 2013. [15]

Participation by race and gender Edit

The racial composition of stock market ownership shows households headed by whites are nearly four and six times as likely to directly own stocks than households headed by blacks and Hispanics respectively. As of 2011 the national rate of direct participation was 19.6%, for white households the participation rate was 24.5%, for black households it was 6.4% and for Hispanic households it was 4.3%. Indirect participation in the form of 401k ownership shows a similar pattern with a national participation rate of 42.1%, a rate of 46.4% for white households, 31.7% for black households, and 25.8% for Hispanic households. Households headed by married couples participated at rates above the national averages with 25.6% participating directly and 53.4% participating indirectly through a retirement account. 14.7% of households headed by men participated in the market directly and 33.4% owned stock through a retirement account. 12.6% of female-headed households directly owned stock and 28.7% owned stock indirectly. [12]

Determinants and possible explanations of stock market participation Edit

In a 2003 paper by Vissing-Jørgensen attempts to explain disproportionate rates of participation along wealth and income groups as a function of fixed costs associated with investing. Her research concludes that a fixed cost of $200 per year is sufficient to explain why nearly half of all U.S. households do not participate in the market. [16] Participation rates have been shown to strongly correlate with education levels, promoting the hypothesis that information and transaction costs of market participation are better absorbed by more educated households. Behavioral economists Harrison Hong, Jeffrey Kubik and Jeremy Stein suggest that sociability and participation rates of communities have a statistically significant impact on an individual's decision to participate in the market. Their research indicates that social individuals living in states with higher than average participation rates are 5% more likely to participate than individuals that do not share those characteristics. [17] This phenomenon also explained in cost terms. Knowledge of market functioning diffuses through communities and consequently lowers transaction costs associated with investing.

Early history Edit

In 12th-century France, the courtiers de change were concerned with managing and regulating the debts of agricultural communities on behalf of the banks. Because these men also traded with debts, they could be called the first brokers. The Italian historian Lodovico Guicciardini described how, in late 13th-century Bruges, commodity traders gathered outdoors at a market square containing an inn owned by a family called Van der Beurze, and in 1409 they became the "Brugse Beurse", institutionalizing what had been, until then, an informal meeting. [18] The idea quickly spread around Flanders and neighboring countries and "Beurzen" soon opened in Ghent and Rotterdam. International traders, and specially the Italian bankers, present in Bruges since the early 13th-century, took back the word in their countries to define the place for stock market exchange: first the Italians (Borsa), but soon also the French (Bourse), the Germans (börse), Russians (birža), Czechs (burza), Swedes (börs), Danes and Norwegians (børs). In most languages the word coincides with that for money bag, dating back to the Latin bursa, from which obviously also derives the name of the Van der Beurse family.

In the middle of the 13th century, Venetian bankers began to trade in government securities. In 1351 the Venetian government outlawed spreading rumors intended to lower the price of government funds. Bankers in Pisa, Verona, Genoa and Florence also began trading in government securities during the 14th century. This was only possible because these were independent city-states not ruled by a duke but a council of influential citizens. Italian companies were also the first to issue shares. Companies in England and the Low Countries followed in the 16th century. Around this time, a joint stock company—one whose stock is owned jointly by the shareholders—emerged and became important for colonization of what Europeans called the "New World". [19]

The first modern stock, for the Dutch East India Company, was traded on the Nieuwe Brug in Amsterdam, the Netherlands in 1602. Initially only trading on that single company, the first derivatives were traded in 1607, with the first dividend distributions following several years later. [20] Futures trading [21] and short-selling [22] were also invented in Amsterdam in these early years.

Birth of formal stock markets Edit

(. ) This enigmatic business [i.e. the inner workings of the stock exchange in Amsterdam, primarily the practice of VOC and WIC stock trading] which is at once the fairest and most deceitful in Europe, the noblest and the most infamous in the world, the finest and the most vulgar on earth. It is a quintessence of academic learning and a paragon of fraudulence it is a touchstone for the intelligent and a tombstone for the audacious, a treasury of usefulness and a source of disaster, (. ) .

The stock market — the daytime adventure serial of the well-to-do — would not be the stock market if it did not have its ups and downs. (. ) And it has many other distinctive characteristics. Apart from the economic advantages and disadvantages of stock exchanges — the advantage that they provide a free flow of capital to finance industrial expansion, for instance, and the disadvantage that they provide an all too convenient way for the unlucky, the imprudent, and the gullible to lose their money — their development has created a whole pattern of social behavior, complete with customs, language, and predictable responses to given events. What is truly extraordinary is the speed with which this pattern emerged full blown following the establishment, in 1611, of the world's first important stock exchange — a roofless courtyard in Amsterdam — and the degree to which it persists (with variations, it is true) on the New York Stock Exchange in the nineteen-sixties. Present-day stock trading in the United States — a bewilderingly vast enterprise, involving millions of miles of private telegraph wires, computers that can read and copy the Manhattan Telephone Directory in three minutes, and over twenty million stockholder participants — would seem to be a far cry from a handful of seventeenth-century Dutchmen haggling in the rain. But the field marks are much the same. The first stock exchange was, inadvertently, a laboratory in which new human reactions were revealed. By the same token, the New York Stock Exchange is also a sociological test tube, forever contributing to the human species' self-understanding. The behaviour of the pioneering Dutch stock traders is ably documented in a book entitled “Confusion of Confusions,” written by a plunger on the Amsterdam market named Joseph de la Vega originally published in 1688, (. )

Business ventures with multiple shareholders became popular with commenda contracts in medieval Italy (Greif, 2006, p. 286), and Malmendier (2009) provides evidence that shareholder companies date back to ancient Rome. Yet the title of the world's first stock market deservedly goes to that of seventeenth-century Amsterdam, where an active secondary market in company shares emerged. The two major companies were the Dutch East India Company and the Dutch West India Company, founded in 1602 and 1621. Other companies existed, but they were not as large and constituted a small portion of the stock market.

In the 17th and 18th centuries, the Dutch pioneered several financial innovations that helped lay the foundations of the modern financial system. [37] [38] [39] [40] While the Italian city-states produced the first transferable government bonds, they did not develop the other ingredient necessary to produce a fully fledged capital market: the stock market. [41] In the early 1600s the Dutch East India Company (VOC) became the first company in history to issue bonds and shares of stock to the general public. [42] As Edward Stringham (2015) notes, "companies with transferable shares date back to classical Rome, but these were usually not enduring endeavors and no considerable secondary market existed (Neal, 1997, p. 61)." [43] The Dutch East India Company (founded in the year of 1602) was also the first joint-stock company to get a fixed capital stock and as a result, continuous trade in company stock occurred on the Amsterdam Exchange. Soon thereafter, a lively trade in various derivatives, among which options and repos, emerged on the Amsterdam market. Dutch traders also pioneered short selling – a practice which was banned by the Dutch authorities as early as 1610. [44] Amsterdam-based businessman Joseph de la Vega's Confusion de Confusiones (1688) [45] was the earliest known book about stock trading and first book on the inner workings of the stock market (including the stock exchange).

There are now stock markets in virtually every developed and most developing economies, with the world's largest markets being in the United States, United Kingdom, Japan, India, China, Canada, Germany (Frankfurt Stock Exchange), France, South Korea and the Netherlands. [46]

Even in the days before perestroika, socialism was never a monolith. Within the Communist countries, the spectrum of socialism ranged from the quasi-market, quasi-syndicalist system of Yugoslavia to the centralized totalitarianism of neighboring Albania. One time I asked Professor von Mises, the great expert on the economics of socialism, at what point on this spectrum of statism would he designate a country as "socialist" or not. At that time, I wasn't sure that any definite criterion existed to make that sort of clear-cut judgment. And so I was pleasantly surprised at the clarity and decisiveness of Mises's answer. "A stock market," he answered promptly. "A stock market is crucial to the existence of capitalism and private property. For it means that there is a functioning market in the exchange of private titles to the means of production. There can be no genuine private ownership of capital without a stock market: there can be no true socialism if such a market is allowed to exist."

Function and purpose Edit

The stock market is one of the most important ways for companies to raise money, along with debt markets which are generally more imposing but do not trade publicly. [48] This allows businesses to be publicly traded, and raise additional financial capital for expansion by selling shares of ownership of the company in a public market. The liquidity that an exchange affords the investors enables their holders to quickly and easily sell securities. This is an attractive feature of investing in stocks, compared to other less liquid investments such as property and other immoveable assets.

History has shown that the price of stocks and other assets is an important part of the dynamics of economic activity, and can influence or be an indicator of social mood. An economy where the stock market is on the rise is considered to be an up-and-coming economy. The stock market is often considered the primary indicator of a country's economic strength and development. [49]

Rising share prices, for instance, tend to be associated with increased business investment and vice versa. Share prices also affect the wealth of households and their consumption. Therefore, central banks tend to keep an eye on the control and behavior of the stock market and, in general, on the smooth operation of financial system functions. Financial stability is the raison d'être of central banks. [50]

Exchanges also act as the clearinghouse for each transaction, meaning that they collect and deliver the shares, and guarantee payment to the seller of a security. This eliminates the risk to an individual buyer or seller that the counterparty could default on the transaction. [51]

The smooth functioning of all these activities facilitates economic growth in that lower costs and enterprise risks promote the production of goods and services as well as possibly employment. In this way the financial system is assumed to contribute to increased prosperity, although some controversy exists as to whether the optimal financial system is bank-based or market-based. [52]

Recent events such as the Global Financial Crisis have prompted a heightened degree of scrutiny of the impact of the structure of stock markets [53] [54] (called market microstructure), in particular to the stability of the financial system and the transmission of systemic risk. [55]

Relation to the modern financial system Edit

A transformation is the move to electronic trading to replace human trading of listed securities. [54]

Behavior of stock prices Edit

Changes in stock prices are mostly caused by external factors such as socioeconomic conditions, inflation, exchange rates. Intellectual capital does not affect a company stock's current earnings. Intellectual capital contributes to a stock's return growth. [56]

The efficient-market hypothesis (EMH) is a hypothesis in financial economics that states that asset prices reflect all available information at the current time.

The 'hard' efficient-market hypothesis does not explain the cause of events such as the crash in 1987, when the Dow Jones Industrial Average plummeted 22.6 percent—the largest-ever one-day fall in the United States. [57]

This event demonstrated that share prices can fall dramatically even though no generally agreed upon definite cause has been found: a thorough search failed to detect any 'reasonable' development that might have accounted for the crash. (Note that such events are predicted to occur strictly by randomness, although very rarely.) It seems also to be true more generally that many price movements (beyond those which are predicted to occur 'randomly') are not occasioned by new information a study of the fifty largest one-day share price movements in the United States in the post-war period seems to confirm this. [57]

A 'soft' EMH has emerged which does not require that prices remain at or near equilibrium, but only that market participants cannot systematically profit from any momentary 'market anomaly'. Moreover, while EMH predicts that all price movement (in the absence of change in fundamental information) is random (i.e. non-trending) [ dubious – discuss ] , many studies have shown a marked tendency for the stock market to trend over time periods of weeks or longer. Various explanations for such large and apparently non-random price movements have been promulgated. For instance, some research has shown that changes in estimated risk, and the use of certain strategies, such as stop-loss limits and value at risk limits, theoretically could cause financial markets to overreact. But the best explanation seems to be that the distribution of stock market prices is non-Gaussian [58] (in which case EMH, in any of its current forms, would not be strictly applicable). [59] [60]

Other research has shown that psychological factors may result in exaggerated (statistically anomalous) stock price movements (contrary to EMH which assumes such behaviors 'cancel out'). Psychological research has demonstrated that people are predisposed to 'seeing' patterns, and often will perceive a pattern in what is, in fact, just noise, e.g. seeing familiar shapes in clouds or ink blots. In the present context, this means that a succession of good news items about a company may lead investors to overreact positively, driving the price up. A period of good returns also boosts the investors' self-confidence, reducing their (psychological) risk threshold. [61]

Another phenomenon—also from psychology—that works against an objective assessment is group thinking. As social animals, it is not easy to stick to an opinion that differs markedly from that of a majority of the group. An example with which one may be familiar is the reluctance to enter a restaurant that is empty people generally prefer to have their opinion validated by those of others in the group.

In one paper the authors draw an analogy with gambling. [62] In normal times the market behaves like a game of roulette the probabilities are known and largely independent of the investment decisions of the different players. In times of market stress, however, the game becomes more like poker (herding behavior takes over). The players now must give heavy weight to the psychology of other investors and how they are likely to react psychologically.

In the period running up to the 1987 crash, less than 1 percent [ citation needed ] of the analysts' recommendations had been to sell (and even during the 2000–2002 bear market, the average did not rise above 5%). In the run-up to 2000, the media amplified the general euphoria, with reports of rapidly rising share prices and the notion that large sums of money could be quickly earned in the so-called new economy stock market. [ citation needed ]

Stock markets play an essential role in growing industries that ultimately affect the economy through transferring available funds from units that have excess funds (savings) to those who are suffering from funds deficit (borrowings) (Padhi and Naik, 2012). In other words, capital markets facilitate funds movement between the above-mentioned units. This process leads to the enhancement of available financial resources which in turn affects the economic growth positively.

Economic and financial theories argue that stock prices are affected by macroeconomic trends. Macroeconomic trends include such as changes in GDP, unemployment rates, national income, price indices, output, consumption, unemployment, inflation, saving, investment, energy, international trade, immigration, productivity, aging populations, innovations, international finance. [63] increasing corporate profit, increasing profit margins, higher concentration of business, lower company income, less vigorous activity, less progress, lower investment rates, lower productivity growth, less employee share of corporate revenues, [64] decreasing Worker to Beneficiary ratio (year 1960 5:1, year 2009 3:1, year 2030 2.2:1), [65] increasing female to male ratio college graduates. [66]

Many different academic researchers have stated that companies with low P/E ratios and smaller-sized companies have a tendency to outperform the market. Research has shown that mid-sized companies outperform large cap companies, and smaller companies have higher returns historically. [ citation needed ]

Irrational behavior Edit

Sometimes, the market seems to react irrationally to economic or financial news, even if that news is likely to have no real effect on the fundamental value of securities itself. [67] However, this market behaviour may be more apparent than real, since often such news was anticipated, and a counter reaction may occur if the news is better (or worse) than expected. Therefore, the stock market may be swayed in either direction by press releases, rumors, euphoria and mass panic.

Over the short-term, stocks and other securities can be battered or buoyed by any number of fast market-changing events, making the stock market behavior difficult to predict. Emotions can drive prices up and down, people are generally not as rational as they think, and the reasons for buying and selling are generally accepted.

Behaviorists argue that investors often behave irrationally when making investment decisions thereby incorrectly pricing securities, which causes market inefficiencies, which, in turn, are opportunities to make money. [68] However, the whole notion of EMH is that these non-rational reactions to information cancel out, leaving the prices of stocks rationally determined.

The Dow Jones Industrial Average biggest gain in one day was 936.42 points or 11%. [69]


Microsoft Excel’s new STOCKHISTORY function gives you access to historical stock data

Last year, Microsoft introduced new Stocks data type in Excel. It allowed users to easily pull refreshable quotes for stocks, bonds, funds, and currency pairs inside Excel document. Apart from the current stock information, users might also need the history of a financial instrument. To solve this issue, Microsoft Excel is introducing a new function called STOCKHISTORY.

STOCKHISTORY function signature:

STOCKHISTORY(stock, start_date, [end_date],[interval],[headers], [property0], [property1] [property2], [property3], [property4], [property5])

  • stock: The identifier for the financial instrument targeted. This can be a ticker symbol or a Stocks data type.
  • start_date: The earliest date for which you want information.
  • end_date (optional): The latest date for which you want information.
  • interval (optional): Daily (0), Weekly (1), or Monthly (2) interval options for data
  • headers (optional): Specifies if additional header rows are returned with the array.
  • property0 – property5 (optional): Specifies which information should be included in the result, Date (0), Close (1), Open (2), High (3), Low (4), Volume (5).

Microsoft is using the historical data from Refinitiv for this function. STOCKHISTORY feature is now available to half of Microsoft 365 Subscribers in the Beta level of the Office Insider program.

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Watch the video: This Day in History: First Stock Ticker Debuts Sunday, November 15