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American Stock Exchange

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The American Stock Exchange (AMEX) is an American stock exchange situated in New York. AMEX is a mutual organization, owned by its members.

The Exchange traces its roots back to colonial times when stock brokers created outdoor markets to trade new government securities. The AMEX started out as such a market at the curbstone on Broad Street near Exchange Place. The curb brokers gathered around the lamp posts and mail boxes, resisting wind and weather, putting up lists of stocks for sale. As trading activity increased, the shouting reached such a high level that special hand signals had to be introduced so that the brokers could continue trading. In 1921 the market was moved indoors into the building where it still resides, and the hand signals remained in place for decades even after the move.

AMEX's core business has shifted over the years from stocks to options and Exchange-traded funds, although it continues to trade small to mid-size stocks. An effort in the mid-1990s to initiate an Emerging Company Marketplace ended in failure, as the reduced listing standards (beyond the existing lenient AMEX standards) caused penny stock promoters to move their scams to a national exchange. In the mid 1990s the exchange was dogged by allegations of trading improprieties, which were highlighted by BusinessWeek in 1999.[1]

In 1998, the American Stock Exchange merged with the National Association of Securities Dealers (operators of NASDAQ) to create "The Nasdaq-Amex Market Group" where AMEX is an independent entity of the NASD parent company. After tension between the NASD and AMEX members, the latter group bought out the NASD and acquired control of the AMEX in 2004.

Out of the three major American stock exchanges, the AMEX is known to have the most liberal policies concerning company listing, as most of its companies are generally smaller compared to the NYSE and NASDAQ. The Amex also specialises in the trading of ETFs, and hybrid/structured securities. The majority of US listed ETF's are traded at the AMEX including the SPDR and most Powershares.

In 2005, the AMEX attempted to popularize an American implementation of the Canadian income trust model. Listed Equity Income Hybrid Securities, (more commonly known as Income Deposit Securities) listed on the AMEX are B & G Foods Holding Corp. (BGF), Centerplate, Inc. (CVP), Coinmach Service Corp. (DRY), and Otelco Inc. (OTT). Recently Coinmach Service Corp, has been attempting to restructure itself away from being an income trust.

The large companies listed on the AMEX include British American Tobacco (ADR) (BTI), Imperial Oil Limited (IMO), Seaboard Corporation (SEB) and Bio-Rad Laboratories (BIO). Seaboard is notable for not having split its shares since becoming publicly listed; shares of SEB trade for around $1,300 a share.

The AMEX also produces stock market indices; perhaps the most notable of these is an index of stocks of internet companies now known as the Inter@ctive Week Internet Index. Recently, the AMEX has also developed a unique set of indices known as Intellidexes, which attempt to gain alpha by creating indices weighted on fundamental factors. The AMEX Composite, a value-weighted index of all stocks listed on the exchange, established a record monthly close of 2,069.16 points on November 30, 2006.

Located near the World Trade Center, the operation of the AMEX was temporarily affected by the September 11, 2001 attacks.

• Exchange-traded fund (American Stock Exchange - ETFs)
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• NASDAQ
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