The Stock Market

Did you know that unlike the mundane stock trading, the history of the stock market is mesmerizing as well as awash with valuable knowledge? But amazingly, when most people talk about the stock market, they only have an abstract idea of what they are conversing for they have seldom moved out of the console of their computer terminals to trade stocks.

Conversely, many people are of the view that the Wall Street and the stock market are synonymous. This belief, however, isn’t actually very close to reality. The Wall Street is really the place where all the stock trading began and where the world's leading as well as largest fiscal market was born and flourished giving rise to an altogether new business and jargon.

The Wall Street

The Wall Street first came into being in 1653 when a group of Dutch colonists built a 12-feet barrier on the location with a view to ward off potential attacks by the native Red Indians and the British settlers. Little did they realise then that the minimal structure they had put up to defend against the Red Indians would eventually go on to become the world’s principle fiscal and financial center. The wall remained in place for 32 years till it was brought down to lay a new road called the Wall Street!

Nevertheless, the first stock exchange in America was founded in Philadelphia in 1970 and two years hence 24 New York traders got together to thrash out the ways and means to control the securities business. They established a group what is today known as the New York Stock Exchange, but by 1817 they became disconcerted over the plight of their stock market trading and sent a delegate to observe the functioning of the flourishing stock exchange in Philadelphia. Inspired by the reports, they soon founded the New York Stock and Exchange Board and opened office on the Wall Street.

Online Stock Trading

Over the years, the stock trading business has undergone a sea change. Gone are the days when the stock broker or trader would physically visit the stock markets for his transactions. Today it is online stock market trading that is in vogue. In the present-day, professional stock market traders are armed with advanced computers using refined modus operandi and up-to-date information that enables them to make valuation near science. These stock brokers are well connected with millions of links worldwide, including small businesses, banks and larger corporations, enabling computerised transactions possible in the wink of an eye! They are in regular interaction with stock brokers across the globe and linked to all major financial markets closely.

The Risk Factor

The business of stock trade has been risk-free till the early 1900s when people made huge money from stock trades. However, this trend came to a halt in 1929 with the ill-famed great market collapse and the consequent ‘Great Depression’. And this was not the last time that the stock market witnessed downturns and stock trading has been full of up and down swings since then. And the last major crash came in 1987 that made the governments ensure that the pensioner’s hard earned money is protected in the stock market.

Dos and Don’ts

However, despite the risks, one should not be discouraged from investing in the stock trade. Many people think that the stock market is a place to make some quick money. True, but first you need to tutor yourself on fiscal matters and the investment business. This will help you to identify good prospects and make investments even without the help of stock trading companies or analysts.

Before you make any investment in the stock market try to analyse who are most likely to get hit by the market slump. Follow these simple dos and don’ts to avoid be caught in a crash.

• Don’t be over exposed.
• Don’t believe in the media hype.
• Keep your investment and risk profile in the line of investment.
• If you are new in the business, be prepared for the risk.
• Make sure of the value a firm is currently selling at before making any investment.

Before concluding let us remind you of what Benjamin Graham has to say on stock market trading: “To achieve satisfactory investment results is easier than most people realise; to achieve superior results is harder than it looks."