Editing Stock exchange (section)

==History==<!-- This section is linked from [[Global financial system]] -->
The beginnings of lending were in Italy in the late Middle Ages. In the 14th century, Venetian lenders would carry slates with information on the various issues for sale and meet with clients, much like a broker does today.<ref>{{cite book | url=https://muse.jhu.edu/book/68456 | isbn=9781421431444 | title=The Venetian Money Market: Banks, Panics, and the Public Debt, 1200-1500 | year=2019 | publisher=Johns Hopkins University Press | access-date=20 November 2022 | archive-date=20 November 2022 | archive-url=https://web.archive.org/web/20221120095826/https://muse.jhu.edu/book/68456 | url-status=live }}</ref> Venetian merchants introduced the principle of exchanging debts between [[moneylenders]]; a lender looking to unload a high-risk, high-interest loan might exchange it for a different loan with another lender. These lenders also bought government debt issues.<ref>{{cite web | url=https://www.investopedia.com/articles/07/stock-exchange-history.asp | title=The Birth of Stock Exchanges | access-date=20 November 2022 | archive-date=26 October 2007 | archive-url=https://web.archive.org/web/20071026065858/https://www.investopedia.com/articles/07/stock-exchange-history.asp | url-status=live }}</ref> As the natural evolution of their business continued, the lenders began to sell debt issues to the first individual investors. The Venetians were the leaders in the field and the first to start trading securities from other governments, yet did not embark on private trade with India. Nor did the Italians connect on land with the Chinese [[Silk Road]]. Along the potential overland trade route, Holy Roman Emperor [[Frederick II, Holy Roman Emperor|Frederick II]] repulsed advances by Mongol [[Batu Khan|Batu Kahn]] ([[Golden Horde]]) in 1241.<ref>{{Cite journal |date=1245 |title=Letter of Güyük Khan to Pope Innocent IV |journal=Vatican Secret Archives, Vatican City, Inv. No. A. A. |issue=Arm. I-XVIII}}</ref> There is little consensus among scholars as to when corporate [[stock]] was first traded. Some view the key event as the [[Dutch East India Company]]'s founding in 1602,<ref>{{cite web | url=https://www.investopedia.com/ask/answers/08/first-company-issue-stock-dutch-east-india.asp | title=What Was the First Company to Issue Stock? | first=Andrew | last=Beattie | work=[[Investopedia]] | date=December 13, 2017 | access-date=22 March 2019 | archive-date=4 February 2020 | archive-url=https://web.archive.org/web/20200204153527/https://www.investopedia.com/ask/answers/08/first-company-issue-stock-dutch-east-india.asp | url-status=live }}</ref> while others point to much earlier developments (Bruges, Antwerp in 1531 and in Lyon in 1548). The first book in history of securities exchange, the Confusion of Confusions, was written by the Dutch-Jewish trader [[Joseph de la Vega]] and the [[Amsterdam Stock Exchange]] is often considered the oldest "modern" securities market in the world.<ref name="Braudel">{{cite book|last1=Braudel|first1=Fernand|title=Wheels of Commerce: Civilization & Capitalism 15th-18th Century|date=1983|publisher=Harper & Row|location=New York |isbn=0060150912 }}</ref> On the other hand, economist [[Ulrike Malmendier]] of the [[University of California at Berkeley]] argues that a share market existed as far back as [[ancient Rome]], that derives from [[Etruscan language|Etruscan]] "Argentari". In the [[Roman Republic]], which existed for centuries before the [[Roman Empire|Empire]] was founded, there were ''societates publicanorum'', organizations of contractors or leaseholders who performed temple-building and other services for the government. One such service was the feeding of geese on the Capitoline Hill as a reward to the birds after their honking warned of a Gallic invasion in 390&nbsp;B.C. Participants in such organizations had ''partes'' or shares, a concept mentioned various times by the statesman and orator [[Cicero]]. In one speech, Cicero mentions "shares that had a very high price at the time". Such evidence, in Malmendier's view, suggests the instruments were tradable, with fluctuating values based on an organization's success. The ''societas'' declined into obscurity in the time of the emperors, as most of their services were taken over by direct agents of the state.

Tradable [[Bond (finance)|bonds]] as a commonly used type of security were a more recent innovation, spearheaded by the Italian city-states of the late [[medieval]] and early [[Renaissance]] periods.<ref name="Edward P 2006, p. 286">Stringham, Edward Peter; Curott, Nicholas A.: ''On the Origins of Stock Markets'' [Part IV: ''Institutions and Organizations''; Chapter 14], pp. 324–344, in ''The Oxford Handbook of Austrian Economics'', edited by [[Peter J. Boettke]] and Christopher J. Coyne. (Oxford University Press, 2015, {{ISBN|978-0199811762}}). [[Edward Stringham|Edward P. Stringham]] & Nicholas A. Curott: "Business ventures with multiple shareholders became popular with ''[[commenda]]'' contracts in medieval Italy ([[Avner Greif|Greif]], 2006, p. 286), and [[Ulrike Malmendier|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 (Israel [1989] 1991, 109–112; Dehing and 't Hart 1997, 54; dela Vega [1688] 1996, 173)."</ref>

[[File:Bird's-eye view of the Beurs van Hendrick de Keyser by Claes Jansz. Visscher (II) 1612 Stadsarchief Amsterdam 010001000620.jpg|thumb|right|A 17th-century engraving depicting the [[Amsterdam Stock Exchange]]]]
[[Joseph de la Vega]], also known as Joseph Penso de la Vega and by other variations of his name, was an Amsterdam trader from a Spanish Jewish family and a prolific writer as well as a successful businessman in 17th-century Amsterdam. His 1688 book ''Confusion of Confusions''<ref>[[Joseph de la Vega|De la Vega, Joseph]], ''Confusion de Confusiones'' (1688), ''Portions Descriptive of the Amsterdam Stock Exchange'', introduction by Hermann Kellenbenz, Baker Library, Harvard Graduate School of Business Administration (1957)</ref> explained the workings of the city's [[stock market]]. It was the earliest book about [[stock trading]] and inner workings of a stock market, taking the form of a dialogue between a merchant, a [[shareholder]] and a philosopher, the book described a market that was sophisticated but also prone to excesses, and de la Vega offered advice to his readers on such topics as the unpredictability of market shifts and the importance of patience in investment.

[[File:Microcosm of London Plate 075 - New Stock Exchange (tone).jpg|thumb|upright=0.85|[[London Stock Exchange]] in 1810]]
In England, the Dutch [[William III of England|King William III]] sought to modernize the kingdom's finances to pay for its wars, and thus the first government bonds were issued in 1693 and the [[Bank of England]] was set up the following year. Soon thereafter, English [[joint-stock company|joint-stock companies]] began going public.

London's first stockbrokers, however, were barred from the old commercial center known as the Royal Exchange, reportedly because of their rude manners. Instead, the new trade was conducted from coffee houses along [[Exchange Alley, London|Exchange Alley]]. By 1698, a broker named John Castaing, operating out of [[Jonathan's Coffee House]], was posting regular lists of stock and commodity prices. Those lists mark the beginning of the [[London Stock Exchange]].<ref>{{cite web | url=http://www.stockbroking101.com/stockbroker-101-a-cool-history/ | title=Stockbroker 101 - A Cool History | publisher=Stockbroker 101 | access-date=22 March 2019 | archive-date=22 August 2018 | archive-url=https://web.archive.org/web/20180822113545/http://www.stockbroking101.com/stockbroker-101-a-cool-history/ | url-status=dead }}</ref>

===18th century===
One of history's greatest [[financial bubble]]s occurred around 1720. At the center of it were the [[South Sea Company]], set up in 1711 to conduct English trade with South America, and the [[Mississippi Company]], focused on commerce with France's Louisiana colony and touted by transplanted Scottish financier [[John Law (economist)|John Law]], who was acting in effect as France's central banker. Investors snapped up shares in both, and whatever else was available. In 1720, at the height of the mania, there was even an offering of "a company for carrying out an undertaking of great advantage, but nobody to know what it is".

By the end of that same year, share prices had started collapsing, as it became clear that expectations of imminent wealth from the Americas were overblown. In London, Parliament passed the [[Bubble Act]], which stated that only royally chartered companies could issue public shares. In Paris, Law was stripped of office and fled the country. Stock trading was more limited and subdued in subsequent decades. Yet the market survived, and by the 1790s shares were being traded in the young United States. On May 17, 1792, the [[New York Stock Exchange]] opened under a ''[[Platanus occidentalis]]'' (buttonwood tree) in [[New York City]], as 24 stockbrokers signed the [[Buttonwood Agreement]], agreeing to trade five securities under that buttonwood tree.<ref>{{cite web | url=https://www.loc.gov/rr/business/hottopic/stock_market.html | title=History of the NY Stock Exchange | publisher=[[Library of Congress]] | date=May 2004 | access-date=22 March 2019 | archive-date=4 April 2016 | archive-url=https://web.archive.org/web/20160404085759/http://loc.gov/rr/business/hottopic/stock_market.html | url-status=live }}</ref>

===19th century onwards===
[[File:The New Oriental Bank and Share Market, Bombay.jpg|thumb|upright=0.85|The New Oriental Bank and Share Market, Bombay (now [[Mumbai]]) in 1875 acting as [[Bombay Stock Exchange]]]]
Bombay Stock Exchange was started by Premchand Roychand in 1875.<ref>{{cite news |title=BSE may set another record, become an official tourist spot |url=https://www.newindianexpress.com/cities/mumbai/2017/oct/06/bse-may-set-another-record-become-an-official-tourist-spot-1667426.html |access-date=4 November 2021 |work=[[The New Indian Express]] |agency=[[Press Trust of India]] |date=6 October 2017 |archive-date=4 November 2021 |archive-url=https://web.archive.org/web/20211104151832/https://www.newindianexpress.com/cities/mumbai/2017/oct/06/bse-may-set-another-record-become-an-official-tourist-spot-1667426.html |url-status=live }}</ref> While BSE Limited is now synonymous with Dalal Street, it was not always so. In the 1850s, five stock brokers gathered together under a Banyan tree in front of Mumbai Town Hall, where Horniman Circle is now situated.<ref>{{cite web |title=THE PROFILE OF BOMBAY STOCK EXCHANGE LIMITED |url=https://www.researchgate.net/publication/289504506}}</ref> A decade later, the brokers moved their location to another leafy setting, this time under banyan trees at the junction of Meadows Street and what was then called Esplanade Road, now Mahatma Gandhi Road. With a rapid increase in the number of brokers, they had to shift places repeatedly. At last, in 1874, the brokers found a permanent location, the one that they could call their own. The brokers group became an official organization known as "The Native Share & Stock Brokers Association" in 1875.<ref>{{cite web |title=The History of Bombay Stock Exchange |website = [[YouTube]]| date=11 September 2014 |url=https://www.youtube.com/watch?v=oDkiJcRWvRQ| archive-url=https://ghostarchive.org/varchive/youtube/20211030/oDkiJcRWvRQ| archive-date=2021-10-30}}{{cbignore}}</ref>

The Bombay Stock Exchange continued to operate out of a building near the [[Asiatic Society of Bombay|Town Hall]] until 1928. The present site near [[Horniman Circle Gardens|Horniman Circle]] was acquired by the exchange in 1928, and a building was constructed and occupied in 1930. The street on which the site is located came to be called ''Dalal Street'' in Hindi (meaning "Broker Street") due to the location of the exchange.

On 31 August 1957, the BSE became the first stock exchange to be recognized by the [[Indian Government]] under the Securities Contracts Regulation Act. Construction of the present building, the [[Phiroze Jeejeebhoy Towers]] at [[Dalal Street]], [[Fort (Mumbai precinct)|Fort area]], began in the late 1970s and was completed and occupied by the BSE in 1980. Initially named the ''BSE Towers'', the name of the building was changed soon after occupation, in memory of Sir [[Phiroze Jamshedji Jeejeebhoy]], chairman of the BSE since 1966, following his death.

In 1986, the BSE developed the S&P [[BSE SENSEX]] index, giving the BSE a means to measure the overall performance of the exchange. In 2000, the BSE used this index to open its derivatives market, trading S&P BSE SENSEX futures contracts. The development of S&P BSE SENSEX options along with equity derivatives followed in 2001 and 2002, expanding the BSE's trading platform.

Historically an open outcry floor trading exchange, the Bombay Stock Exchange switched to an electronic trading system developed by [[Cmc ltd]]. in 1995. It took the exchange only 50 days to make this transition. This automated, [[screen-based trading]] platform called BSE On-Line Trading (BOLT) had a capacity of 8 million orders per day. Now BSE has raised capital by issuing shares and as on 3 May 2017 the BSE share which is traded in NSE only closed with ₹999.<ref>{{cite web |url=http://www.bseindia.com/about/tech.asp |title=BSEIndia |publisher=BSEIndia |access-date=28 July 2010 |url-status=dead |archive-url=https://web.archive.org/web/20140122172626/http://www.bseindia.com/about/tech.asp |archive-date=22 January 2014 |df=dmy-all }}</ref>