What is the American Stock Exchange - AMEX

The American Stock Exchange (AMEX) once was the third-largest stock exchange in the United States, as measured by trading volume. The exchange, at its height, handled about 10 percent of all securities traded in the US.

The AMEX dates back to the late 18th century when the American trading market was still developing. At that time, without a formalized exchange, stock brokers would meet in coffeehouses and on the street to trade securities. For this reason, it became known at one time as the New York Curb Exchange.

The AMEX used to be a larger competitor of the New York Stock Exchange (NYSE), but in recent times, the Nasdaq has filled that role.

The AMEX now is known as the NYSE American. In 2008, the NYSE Euronext acquired the AMEX. In the subsequent years, it also became known as NYSE Amex Equities and NYSE MKT.

BREAKING DOWN American Stock Exchange - AMEX

The AMEX developed a reputation over time as an exchange that introduced traded new products and asset classes. For example, it launched its options market in 1975. Options are a type of derivative security. They are contracts that grant the holder the right to buy or sell an asset at a set price on or before a certain date, without the obligation to do so. When the AMEX launched its options market, it also distributed educational materials to help educate investors as to the potential benefits and risks.

In 1993, the AMEX introduced the first exchange-traded fund (ETF). ETFs are a type of marketable security that tracks an index or a basket of assets. They are much like mutual funds, but unlike mutual funds, ETFs trade like common stocks on an exchange.

Most trading on the NYSE American is in small-cap stocks, derivatives and ETFs.

History of the Exchange

The traders who originally met in the streets of New York became known as curbstone brokers. They specialized in trading stocks of emerging companies. At the time, many of these emerging businesses were in industries such as railroads, oil and textiles, while those industries were still getting off the ground.

In the 19th century, this type of curbside trading was informal and quite disorganized. In 1908, the New York Curb Market Agency was established in order to bring rules and regulations to trading practices.

In 1929, the New York Curb Market became the New York Curb Exchange. It had a formalized trading floor and a set of rules and regulations. In the 1950s, more and more emerging businesses began trading their stocks on the New York Curb Exchange. The value of companies listed on the exchange almost doubled between 1950 and 1960, going from $12 billion to $23 billion during that time.