What is the American stock market?

The American stock market refers to the financial markets in the United States where stocks, bonds, mutual funds, and other financial instruments are bought and sold. The most important and well-known American stock exchanges are:

1. New York Stock Exchange (NYSE)

• Founded: 1792
• Location: New York City, Wall Street
• Features: The largest stock exchange in the world, hosting the shares of major corporations like Apple, Coca-Cola, and IBM.

2. NASDAQ

• Founded: 1971
• Location: New York City
• Features: Known as an electronic exchange with a high concentration of technology companies. Major tech firms like Google (Alphabet), Microsoft, and Amazon are listed here.

3. American Stock Exchange (AMEX)

• Founded: 1908 (as AMEX in 1953)
• Location: New York City
• Features: A significant platform for smaller companies and specialized investment products (ETFs, options). It was acquired by NYSE Euronext in 2008 and is now known as NYSE American.

4. Chicago Board Options Exchange (CBOE)

• Founded: 1973
• Location: Chicago
• Features: The world’s largest options exchange, where investors can trade options on various financial instruments.

Stock Market Operation

Stocks and other financial instruments are bought and sold by investors on stock exchanges. Most transactions occur electronically and are subject to the rules and regulations set by the exchanges. Here are some key points about stock market operations:

• Brokerage Firms: Investors use brokerage firms to trade on the stock market.
• Stocks: Represent ownership shares in companies and are traded on stock exchanges.
• Indexes: Used to measure the performance of stock markets. Examples include the Dow Jones Industrial Average (DJIA) for NYSE and the NASDAQ Composite Index for NASDAQ.
• Regulations: In the U.S., stock markets are regulated and supervised by the Securities and Exchange Commission (SEC).

Investment Instruments

Various investment instruments traded on American stock exchanges include:

• Stocks: Ownership shares in companies.
• Bonds: Debt securities issued by corporations or governments as a borrowing instrument.
• ETFs (Exchange-Traded Funds): Funds that track specific indexes and are traded on stock exchanges.
• Options: Financial instruments that give the right, but not the obligation, to buy or sell a security at a predetermined price by a specific date.
• Futures: Contracts to buy or sell an asset at a predetermined price on a specific future date.

The American stock market is considered the heart of global financial markets and has a significant impact on the world economy. While it offers substantial opportunities for investors, it also requires a careful and informed investment strategy.