History market price stock
Introduction
A stock market means a place where the stock and derivatives of a company can be traded. The stock and derivatives are securities and are listed in the stock exchange and these can be traded privately. The concept of stock market helps in trading of a companys stock, derivatives and other securities. Bonds are traded in the bond market and commodities are traded in market for commodities.
History
It was believed that the Italians set up several trade associations. However this belief was disputed by the historian Fernand Braudel. He suggested that Jewish and Muslim merchants had already set up trade associations as early as the 11th century in Cairo and had knowledge of various methods of payment and credit. In the early part of the 12th century the courratiers de change of France was concerned of regulating and managing various debts of the farming community. As these people traded in debts they were called the first brokers. Commodity traders in Belgium gathered in the house of Van der Beurse in the later part of the 13th century. In a meeting held in Bruges the people decided to institutionalize the informal meeting and very soon the first stock exchange was established in Amsterdam and Ghent.
The mid 13th century saw the beginning of Venetian bankers trading in securities of the government. The government of Venice outlawed rumors that were responsible for decreasing the value of government stokes. Bankers in Verona, Pisa, Florence and Genoa started to trade in securities of the government in the 14th century. This was possible as the state was ruled by influential citizens and not by a Duke. The Dutch were the next to start a stock exchange which allowed stock holders to get a part of profit and loss. The East India Company run by the Dutch was the first company to issue shares of the stock exchange of Amsterdam. This stock exchange is said to the first stock exchange of the world which introduces trade in shares.
Functions and purpose of a stock market
The main purpose of a stock market is to raise money for the companies so that they can expand, grow and go public. Since there is a lot of liquidity that is provided by the exchange, it allows investors to sell securities easily and quickly. Due to this feature investing in the stock market is attractive as compared to other liquid investment options such as real estate.
The share price is one of the important dynamics of economics and can be safely said that it is an indicator of the mood of the society. The rise in share prices indicates that the business and investment of a company is increasing. However if the price is decreasing it indicates that the investment is decreasing. The prices of shares also affect the wealth of several households. Thus there is a tendency among the central banks to keep an eye on the stock market. Stock exchange acts as a storehouse of transactions which means that they deliver and collect shares and look to it that the shareholders are paid on time and in full.
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