DEFINITION of 'Buttonwood Agreement'

The agreement between 24 of United States' first and most prominent brokers. Rumored to have occurred under a "buttonwood" tree, this marked the beginnings of the investment community of Wall Street.

BREAKING DOWN 'Buttonwood Agreement'

The brokers based the U.S. system upon existing European trading systems. In fact, the Spanish practice of dividing the silver dollar into eighths was largely responsible for the prevalence of fractions when describing stock values.

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