Of course, stock markets did not begin as the high-tech, super-sophisticated, simultaneous, worldwide trading exchanges of today, but the concept of stocks and shares, and the dealings thereof, go back many years.

 How it all began … Foreign Exchange is born.

The history of stock exchanges can be traced to 12th century France, when the first brokers are believed to have emerged, trading in debt and government securities. Unofficial stock markets existed across Europe through the 1600s, where brokers would meet outside or in coffee houses to make trades. The Amsterdam Stock Exchange, created in 1602, became the first official stock exchange when it began trading shares of the Dutch East India Company. These were the first company shares ever issued.  It was not until 1531, however, when the first institution roughly approximating a stock market emerged, in Antwerp, Belgium. Rather than buying and selling shares of companies (which did not yet exist), brokers and lenders congregated there to “deal in business, government and even individual debt issues.” This changed in the 1600′s, when Britain, France, and the Netherlands all chartered voyages to the East Indies.

From little acorns….

The London Stock Exchange history is proof that from something small, a huge giant can be built. It can trace its history back more than 300 years. Starting life in the coffee houses of 17th century London, the Exchange quickly grew to become the City’s most important financial institution; indeed, probably the world’s financial hub!

The London Stock Exchange began in 1698, when a man named John Castaing began publishing lists of stock prices called ‘The Course of the Exchange and Other Things’. London’s stock dealers were at this time still making trades in the streets and in coffee houses. In 1761, 150 of these stockbrokers started a club for buying and selling shares in a dealing room on Sweeting’s Alley, which eventually became known as The Stock Exchange. It became an official, regulated exchange in 1801 and a year later moved into a building in Chapel Court.

Modern times… Two World Wars and One Big Bang!

During the two World Wars, like many other stock exchanges, the London Stock Exchange closed for five months during World War I, and again for six days during World War II. Then in 1972 a new office with a 23,000 square foot trading floor was opened for the exchange by Queen Elizabeth II on Threadneedle Street. A year later, all the regional exchanges in England and Ireland merged with the London Stock Exchange.

In 1986 there was a deregulation of the exchange, called the ‘Big Bang’. Among other things, this deregulation allowed outside corporations to own member firms, eliminated voting rights for individual members, and transformed the face-to-face trading system into one largely operated over computers and telephones.

The London Stock Exchange Today

In 1995, the London Stock Exchange opened the Alternative Investment Market, creating the division between the trading of large cap and small cap companies. In 2000, the London Stock Exchange made the decision to go public, and began listing their shares on their own exchange in 2001. In 2004, the exchange left their building on Threadneedle Street moving to their current location on Paternoster Square, close to St. Pauls Cathedral.