Stock Certificates Over Time

Stock Certificates Over Time by Larry Crain of RealStockCertificates.com LLC

Although most antique stocks date to the 1830s through the 1880s due to the Industrial Revolution and the rise of mining, railroads, and other large companies, in actuality the first stocks were issued much earlier. The first companies to issue stock shares began doing so in the late 1700’s; it is at the very end of this century that the earliest known stock certificates were produced.



The first known stock certificates, produced in the 1770’s or 1780’s, are quite rare because they were produced in very small quantities. In 1800, there were only 295 corporations which had issued stock certificates; only 20 of these traded them publicly. In contrast, there were approximately 120 companies with publicly traded stock in 1835. These mid-nineteenth century stocks were produced in larger quantities due to the rising number of stock investors, and are generally more readily available today. In fact, stocks from this era are commonly purchased for well under a hundred dollars for each certificate.



Each paper certificate, prized by collectors, represented one stake in a given company, purchased by investors speculating about the company’s future. Originally, these certificates included hand-printed denominations to denote the numbers of shares being bought or sold. Later certificates were issued in standard denominations to reduce the workload involved for companies selling stocks. The earliest known pre-printed stocks date to around 1870.



At first, there was no formalized market governing the prices of these shares, although trading began at the corners of Broad Street and Wall Street in New York by the early nineteenth century. Individuals could not realistically purchase their stocks directly from the company, especially as mid-nineteenth century companies grew large enough to issue many thousands of stock certificates. The first American stock exchange, the Philadelphia Stock Exchange, was founded in 1790. The Stock Exchange in New York followed shortly, in 1792. This organization evolved into the New York Stock Exchange, which opened in the 1860’s to facilitate large-scale stock trades. Many names we would recognize today, including Eastman Kodak, Procter and Gamble, Sears, Kellogg, and Nabisco issued stock through the New York Stock Exchange in the late 1800’s. As more and more investors took part in stock trading, the quantity of paper stock certificates rose exponentially. In 1886, over one million stock shares were traded in the NYSE. In 1929, this number topped 10 million, and in 1982, 100 million.



Throughout the end of the 1800’s and most of the 1900’s, all trading of stocks involved paper stock certificates. By the end of the 1960’s, however, NASDAQ ushered in an era of electronic stock trading. Paper stock certificates, though beautiful, were fast becoming obsolete. At the start of the new millennium, most companies only issue paper certificates upon request, if at all. The vast majority of stock transactions have become paperless.



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