US & World Economies Economic Terms What Is the New York Stock Exchange, and How Does It Work? By Kimberly Amadeo Kimberly Amadeo Kimberly Amadeo is an expert on U.S. and world economies and investing, with over 20 years of experience in economic analysis and business strategy. She is the President of the economic website World Money Watch. As a writer for The Balance, Kimberly provides insight on the state of the present-day economy, as well as past events that have had a lasting impact. learn about our editorial policies Updated on March 4, 2021 Reviewed by Charles Potters Reviewed by Charles Potters Charles is a nationally recognized capital markets specialist and educator with over 30 years of experience developing in-depth training programs for burgeoning financial professionals. Charles has taught at a number of institutions including Goldman Sachs, Morgan Stanley, Societe Generale, and many more. learn about our financial review board In This Article View All In This Article How the NYSE Works NYSE Hours of Operation History of the NYSE Frequently Asked Questions (FAQs) Photo: The Image Bank/Getty Images The New York Stock Exchange is the world’s largest stock exchange. It provides a marketplace for buying and selling millions of corporate stocks and other securities per day. The NYSE lists much of the S&P 500, the Dow Jones Industrial Average, and the world's largest corporations. It is also a publicly-traded company with over 2,000 employees. Its ticker symbol is NYSE: ICE. In June 2013, the NYSE was acquired by the Intercontinental Exchange. Key Takeaways Founded in 1792 on 68 Wall Street, the NYSE is the world’s largest stock exchange, based on the volume of market capitalization it trades.ICE now owns the NYSE, having bought it in 2013.Trading is now done either electronically or through the floor traders’ traditional open outcry system. How the NYSE Works The New York Stock Exchange uses two methods of trading: brokers and all-electronic. Regardless of the method of exchange, all stock transactions are an auction. Brokers actively trade stocks on the floor of the NYSE. Buyers and sellers auction securities for the highest price. Brokers represent the entity buying the stock, whether it's for a retail brokerage company or institutional investors such as pension funds. The brokers set the "bid" price, which is the price you're willing to pay for the stock. When your stockbroker executes your order to sell, it is not completed until one of the dealers on the floor of the New York Stock Exchange finds another broker to buy it. Before trading, brokers and dealers must get approved by the NYSE and hold a trading license. The dealers match up the brokers with the stock sellers, who submit an "ask" price. It's usually higher than the bid price. In this way, it's like selling a home. The dealer is like the real estate agent, who puts the buyer and seller together. Dealers get to pocket the difference between the ask and bid price, minus fees and expenses, for their work. Most of the transactions occur electronically. A computer acts as the dealer, matching up buyers and sellers. Even the brokers and dealers get their information and trade electronically. NYSE Hours of Operation The opening bell of the NYSE rings at 9:30 a.m. Eastern, while the closing bell rings at 4 p.m. Eastern. This tradition began in 1870 with a Chinese gong. In 1903, when the NYSE moved to its current location, it switched to brass bells. The NYSE uses the opening and closing bells to celebrate a New York City or financially-related event. It's considered an honor to be invited to ring it. For example, if a company has just issued an Initial Public Offering with the NYSE, that firm's CEO or President of the Board gets to ring the NYSE bell. Note The NYSE is closed for nine American holidays, including New Year's Day, Martin Luther King Day, Washington's Birthday, Good Friday, Memorial Day, Independence Day (July 4), Labor Day, Thanksgiving Day, and Christmas (December 25). In addition, the NYSE closes at 1 p.m. Eastern on Black Friday and Christmas Eve day (December 24). History of the NYSE The NYSE began on May 17, 1792, under a buttonwood tree at 68 Wall Street. Twenty-four brokers and merchants signed the aptly-named Buttonwood Agreement to outline the rules for trading securities. The first stock listed on this exchange was the Bank of New York. The founders named their organization the New York Stock & Exchange Board, which they shortened to the New York Stock Exchange in 1863. There were only 1,366 traders. They were all men until 1967 when Muriel Siebert became the first woman who was allowed to trade. The NYSE became a not-for-profit corporation in 1971 and a publicly traded company in April 2006. That was the same time that it moved to an electronic system used by traders and the public alike. In 2007, the NYSE merged with Euronext. It now has the capacity to trade up to 10 billion shares per day. The move combined the NYSE with the five major European exchanges, including the Paris Bourse, Amsterdam, the London International Financial Futures Exchange, Brussels, and Lisbon. In 2008, the NYSE acquired the American Stock Exchange, focusing on small cap companies. The NYSE Euronext also operates three other exchanges: NYSE Arca, an all-electronic stock exchange trading securities, mutual funds, and options ICE Futures Europe, formerly NYSE Liffe, trading more than 2,000 electronic options and futures contracts for gold and other commodities NYSE Bonds, an all-electronic exchange that trades bonds Frequently Asked Questions (FAQs) Why did the New York Stock Exchange crash? People refer to the New York Stock Exchange as "crashing" when the stocks traded on the exchange crash. While it's difficult to pin down a single cause for any stock market crash, the exchange itself probably isn't the primary cause. Unexpected economic events with broad market implications typically play a role in starting crashes. What time does the New York Stock Exchange open in GMT? The New York Stock Exchange draws the attention of traders all over the world. For traders in Europe using Greenwich Mean Time (GMT), they will start trading NYSE stocks at 2:30 p.m. GMT. Was this page helpful? Thanks for your feedback! Tell us why! Other Submit Sources The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy. NYSE. "About the NYSE Bell." Accessed Aug. 31, 2020. NYSE. "American Stock Exchange: Historical Timeline." Accessed Aug. 31, 2020.