Why Are Company Shares Called “Stock”, What Does the Word Mean, and How Did the Stock Market Originate?

The modern concept of sharing capital ownership was initiated by the Dutch East India Company in 1612, which raised money by selling pieces of the business to the public.

This process gave the Dutch East India Company the ability to grow and share its profits with its “shareholders.”

The original meaning of the word stock was the trunk of a tree.

Like that trunk, “stock” to a corporation supplies the necessities of life to the branches.

This nourishment to any size company is “cash.”

Stocks and shares are the same thing. Stock refers to an overall ownership in one or more companies within a portfolio.

Shares signify ownership of one specific individual company.

Today a “stock market” is a place where securities are bought and sold, and the first one in London, England, was a fourteenth-century fish-and-meat market.

It was called a stock market because it had been built on a site formerly occupied by the “stocks” used for corporal punishment.

About Karen Hill

Karen Hill is a freelance writer, editor, and columnist. Born in New York, her work has appeared in the Examiner, Yahoo News, Buzzfeed, among others.

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