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American Stock Exchange

 

 
 

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The American Stock Exchange (AMEX) is an American stock exchange situated in New York. AMEX is a mutual organization, owned by its members.

The Exchange traces its roots back to colonial times when stock brokers created outdoor markets to trade new government securities. The AMEX started out as such a market at the curbstone on Broad Street near Exchange Place. The curb brokers gathered around the lamp posts and mail boxes, resisting wind and weather, putting up lists of stocks for sale. As trading activity increased, the shouting reached such a high level that special hand signals had to be introduced so that the brokers could continue trading. In 1921 the market was moved indoors into the building where it still resides, and the hand signals remained in place for decades even after the move.

AMEX's core business has shifted over the years from stocks to options and Exchange-traded funds, although it continues to trade small to mid-size stocks. An effort in the mid-1990s to initiate an Emerging Company Marketplace ended in failure, as the reduced listing standards (beyond the existing lenient AMEX standards) caused penny stock promoters to move their scams to a national exchange. In the mid 1990s the exchange was dogged by allegations of trading improprieties, which were highlighted by Business Week in 1999.

In 1998, the American Stock Exchange merged with the National Association of Securities Dealers (operators of NASDAQ) to create "The Nasdaq-Amex Market Group" where AMEX is an independent entity of the NASD parent company. After tension between the NASD and AMEX members, the latter group bought out the NASD and acquired control of the AMEX in 2004.

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