Belgium boasted a stock exchange as far as 1531 in Antwerp.
It’s generally said that Antwerp had the world’s first stock market. Antwerp was the commercial center of Belgium and home to the influential Van der Beurze family. Hence, early stock markets were known as Beurzen.
All of these early stock markets had one main element missing: stocks. Even if the infrastructure and institutions resembled today’s stock markets, nobody was actually trading shares of any company. But, the markets dealt with the affairs of government, businesses, and individual debt. The system and organization were same, although the actual properties being traded were different.
Brokers and moneylenders would gather there to deal in business, government & individual debt issues. It is odd to think of a stock exchange that dealt exclusively in promissory notes and bonds. There were many flavors of business-financier partnerships that produced income, but there was no official share that changed hands.
The world’s first publically traded company:
The East India Company is the world’s 1st publically traded company. Risk was one reason why it became the first publically traded company.
As, sailing to the far corners of the world was too risky for any single company. When India was first discovered of riches and trade opportunities, explorers sailed in droves. Unfortunately, few of these voyages ever made it. Ships and fortunes were lost. Financiers realized something had to be done to mitigate all that risk.
As a result, a unique corporation was formed in 1600 known as the ‘Governor & Company of Merchants of London trading with the East Indies’, the 1st company to use a limited liability formula.
Investors realized that putting all their ‘eggs into one basket’ was not a proper way to approach investment in trading with India. The formula resulted in success. Within a decade, similar charters were granted to other businesses throughout Belgium, England, France, and the Netherlands.
In 1602, the Dutch East India Company became the world’s 1st publically traded company when it released shares of the company on the Amsterdam Stock Exchange. Stocks & bonds were issued to investors & each investor was entitled to a fixed percentage of East India Company’s profits.