40 Surprising Stock Market Fun Facts You Need To Know
15 min read.
The stock market is ever-evolving, full of surprises and complexities. Learning about the ups and downs of the financial markets can be overwhelming, especially if you’re an inexperienced trader.
But there are some fascinating stock market facts that you should know to brush up on your knowledge. From unbelievable rags-to-riches stories to companies with the highest market capitalization, these 40 fun facts on shares and stock exchanges will boost your confidence in navigating the markets and inspire new ideas for investing!
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People have been trading stocks since the 17th century.
The stock market crash of 1929 during the Great Depression led to the creation of the U.S. Securities and Exchange Commission (SEC).
Compound interest is a powerful force in the stock market. It allows investments to grow exponentially over time, turning small initial investments into substantial wealth.
1) The world's first stock exchange
The Amsterdam Stock Exchange, established in 1602, holds the distinction of being the world's first stock exchange. It paved the way for modern stock trading and shaped the financial world we know today.
Equities started trading regularly as a secondary market for the shares of the Dutch East India Company (VOC) where people would buy and sell stocks in open-air markets.
Some people believe that the Dutch East India Company was the first multinational corporation. The business was very influential and had almost government-like authority, being able to declare war, imprison and execute criminals, make agreements, create its currency, and set up settlements.
2) There are more than 60 stock markets in the world
There are more than 60 exchanges in the world, with 17 that have a total market capitalization of over US$1 trillion each.
Some of the biggest stock exchanges include:
New York Stock Exchange (USA)
Shanghai Stock Exchange (Chinese stock market)
Euronext (European Stocks)
Japan Exchange Group
Hong Kong Stock Exchange
Bombay Stock Exchange (India)
Each country typically has its primary stock exchange, and there are also regional and specialized stock exchanges that cater to specific industries or sectors.
Read the incredible story of The Pirate Stock Exchange.
3) The US global market cap
The US stock market is worth more than the next seven stock exchanges combined! With a total market cap of $40T, the NYSE and Nasdaq stock exchanges combined take center stage in the world stock market.
While the relative sizes of exchanges can change over time due to various factors such as economic conditions, stock market performance, and investor sentiment, historical data suggests this dominance is here to stay.
Source: Visual Capitalist
4) The longest bull market ended recently
Bull markets can last for a few months to several years. The US bull market's 11-year streak ended in 2020, as markets globally were hit by fears of the spreading Covid-19 pandemic.
Following the 2008 global financial crisis, the US markets started to boom in March 2009, which lasted for over ten years and was fueled by a combination of consistent economic growth, high corporate profits, and low-interest rates.
5) Stock market circuit breakers
To protect against extreme market volatility, stock exchanges implement circuit breakers that temporarily halt trading in the event of significant price declines.
These circuit breakers provide an opportunity for investors and those on the trading floor to reassess their positions and help prevent panic selling.
U.S. regulations have three levels of circuit breakers, which are set to halt trading when the S&P 500 Index drops 7%, 13%, and 20%.
6) The best month to buy stocks is April
The S&P 500 has closed positive in April in 15 of the last 16 years, according to LPL Financial, which is why April is routinely celebrated as one of the best months of the year for stocks.
There is a theory that suggests that investors are using their tax refunds to buy more stocks, and this is what is causing the rise in share prices.
Another possible reason is that institutional investors may sell some underperforming stocks in March because they need to report to shareholders quarterly, and the first quarter ends in March. Then in April, those investors may have some cash on the sidelines and buy back in.
7) The worst time to trade stocks is September
When looking at stock market statistics, September has been the worst-performing month, on average, going back nearly a century.
The September effect is observed in global markets, not just in the U.S. It is believed that investor behavior at the end of summer when they adjust their portfolios, may be the cause of the negative impact on markets.
8) The impact of Black Friday
Black Friday, the day after Thanksgiving in the United States, is not only known for retail sales but also holds significance for the stock market. The U.S. stock markets are closed on Thanksgiving and will only remain open for half of the day on Black Friday.
Historically, the stock market has performed well on this day, leading some investors to call it the "Black Friday effect".
Having additional days off for Thanksgiving or Christmas can impact stock markets. Traditionally, the markets experience higher trading activity and better returns on the day leading up to a holiday or a long weekend.
9) The stock market is 70% likely to go up in any year
In any given year, the stock market has a 70% probability of increasing and a 30% chance of decreasing.
The S&P 500 index has had an average return of 10% per year for almost 100 years.
10) The first stock market bubble
A commonly known but disputed story, the first recorded stock market bubble dates back to the 17th century, known as the "Tulip Mania", which occurred in the Netherlands.
It reached its peak in the years 1636-1637. During this period, the prices of tulip bulbs skyrocketed to extraordinary levels, driven by speculative buying and trading.
Tulips became a symbol of wealth and status, and people from all walks of life, including ordinary citizens and even farmers, participated in the frenzy.
However, the bubble eventually burst, resulting in a sharp decline in tulip bulb prices. The Tulip Mania serves as a historical example of irrational and speculative stock market bubbles and their subsequent collapse.
11) The most expensive share in the world
Berkshire Hathaway (BRK.A), led by legendary investor Warren Buffett, holds the title of the most expensive stock in the world. As of writing, the stock price is at an astonishing six-figure amount!
12) Changes in stock prices were expressed as fractions
In the early days of the stock market, changes in stock prices were expressed as fractions.
Before the advent of digital trading platforms and decimalization, stock prices were quoted and traded in fractional increments. For example, a stock's price might be listed as "7 1/8" or "12 3/4".
These fractions represented the fractions of a dollar that the stock price had moved up or down. While this system was widely used for many years, it posed challenges in terms of precision and ease of calculation.
Eventually, with the adoption of decimalization, stock prices began to be expressed in decimal format. This transition to decimals has made stock prices more straightforward to interpret for investors and traders, reflecting the ongoing technological advancements that have shaped the financial world we know today.
13) Robots make 90% of stock trades
The High-Frequency Trading Phenomenon: High-frequency trading (HFT) is a practice where powerful computers execute trades at lightning-fast speeds. Some HFT algorithms can place trades in a matter of microseconds, making it nearly impossible for a human stock trader to compete.
In the modern world stock market, robots are responsible for approximately 90% of short-term and crypto trades. With the advancement of technology and the rise of high-frequency trading (HFT), sophisticated algorithms and computer systems have taken over a substantial portion of trading activities.
The use of robots in stock trading has brought increased efficiency and liquidity to the markets, but it has also raised concerns about potential market volatility and the impact of algorithmic trading on human decision-making. As technology continues to evolve, the role of robots in the stock market is expected to expand even further, shaping the future of trading and investment.
14) Women first worked on the New York Stock Exchange in 1943
A significant milestone in the history of the New York Stock Exchange (NYSE) occurred in 1943 when women were first allowed to work on the trading floor. Before this, the NYSE had been a predominantly male-dominated space.
However, with many men away serving in World War II, the need for additional workers opened up opportunities for women to enter the industry. These pioneering women broke barriers and made valuable contributions to the stock market, playing roles as runners, telegraph operators, and clerks.
Their presence in the entire global stock market marked an important step towards gender equality in the financial sector. Today, women continue to make strides in the world of finance and have taken on increasingly prominent roles as traders, analysts, brokers, and mutual fund executives, reshaping the landscape of the stock market and paving the way for future generations.
15) Stock market corrections happen once every 2 years
A stock market correction, defined as a decline of 10% or more from recent highs, tends to occur, on average, once every two years.
While the exact timing and severity of corrections can vary, historical data suggests that these periodic downturns are a natural part of the stock market's cycle.
They serve as a mechanism for price adjustments and can be influenced by various factors such as economic conditions, geopolitical events, or investor sentiment.
Understanding the regularity of stock market corrections can help long-term investors prepare for potential downturns and adopt a long-term perspective when navigating the market's inevitable ups and downs.
It reinforces the importance of diversification and maintaining a disciplined approach to investing to weather such fluctuations and capitalize on the opportunities that market corrections may present.
16) Stock market declines of 5% to 10% generally require a month's recovery time
When it comes to stock market statistics, the vast majority of declines ranging from 5% to 10% generally require about a month to recover.
This observation is based on historical patterns and market data - and has no guarantee of future performance. While every market decline is unique and recovery times can vary, this provides a general guideline on how the market performs for investors.
It suggests that moderate downturns in the market often experience a relatively swift recovery within a month's time frame. Investors should approach market downturns with a long-term perspective, focusing on their individual investment goals and maintaining a diversified portfolio to weather short-term volatility.
17) 33% of US households have taxable investment accounts
Approximately 33% of US households have taxable investment accounts. This indicates that a significant portion of the population recognizes the importance of investing and actively participates in the financial markets.
Taxable investment accounts allow individuals to invest in stocks, bonds, mutual funds, and other securities. These accounts offer flexibility and the potential for long-term wealth accumulation.
The fact that a substantial portion of US households hold taxable investment accounts highlights the desire for financial growth and wealth-building beyond traditional savings accounts.
18) Microsoft is worth more than the entire Brazilian stock market
Microsoft (MSFT) holds a higher market cap than the entire Brazilian stock market. This staggering comparison highlights the incredible scale and influence of Microsoft, amongst other Mega-cap stocks, in the global market.
As of the latest available data, Microsoft's market capitalization surpasses the combined value of all publicly listed companies on the Brazilian stock market.
It emphasizes the disparity in market capitalization between individual companies and entire national stock markets, reflecting the varying economic landscapes and dynamics across different regions of the world.
19) You need to change brokers if you do not get free stock trades
With the rise of online brokerage platforms, many investors have come to expect and prioritize commission-free trading.
As a result, if a broker does not offer free stock trades, investors often feel compelled to switch to another brokerage that does provide this feature. The demand for free trades has been driven by increased competition among brokers, resulting in a race to attract customers through low-cost or zero-cost trading options.
This fact reflects the evolving landscape of the brokerage industry, where affordability and accessibility have become key considerations for those seeking to minimize trading costs and maximize returns.
20) The 6 most valuable companies in the USA
The powerhouses shaping the American business landscape. These largest companies have achieved remarkable success and hold significant market value:
Apple Inc. (AAPL): known for its innovative technology and popular products like the iPhone and MacBook, Apple consistently ranks among the most valuable companies in the world.
Microsoft Corporation (MSFT): a technology giant, known for its software products such as Windows and Office, as well as its cloud computing services through Azure.
Alphabet Inc. (GOOGL): the parent company of Google, the dominant search engine worldwide. Google offers a wide range of services, including advertising, cloud computing, and software products like Android.
Amazon.com Inc. (AMZN): the e-commerce behemoth, has expanded its business into various sectors, including cloud computing (Amazon Web Services), streaming services (Amazon Prime Video), and smart devices (Amazon Echo).
Nvidia Corporation (NVDA): a prominent player in the semiconductor industry that specializes in designing and manufacturing graphics processing units. GPUs are essential components in computers, gaming consoles, and other devices that require high-performance graphics rendering.
Tesla, Inc. (TSLA): the electric vehicle pioneer and clean energy company founded by Elon Musk. Tesla is at the forefront of the global transition to sustainable transportation and energy solutions.
Together, these six companies showcase the diversity and innovation that drive the US economy forward.
21) One man used the stock market to understand the U.S. hydrogen bomb
During the Cold War era, when information on the development of advanced weapons was highly classified, Dr. Alchian sought alternative means to gather insights.
Recognizing that the stock market reacts to significant events, he carefully monitored stock price movements and analyzed market trends. By observing fluctuations in companies associated with the defense, technology, and energy sectors, he pieced together valuable clues about the progress of the U.S. hydrogen bomb program.
Through diligent research and astute observations, he utilized the stock market as a unique lens into the secretive world of advanced weaponry, shedding light on a critical aspect of American history. This extraordinary endeavor showcases the ingenuity and creativity of individuals determined to unravel the mysteries of their time, even in the most unconventional ways.
22) How many times has the stock market crashed?
The stock market has experienced several significant crashes throughout history. The S&P 500 index has seen declines of 20% or more on 12 different occasions since 1950.
Some of the most notable crashes include:
The Wall Street Crash of 1929, which marked the beginning of the Great Depression;
The Black Monday crash of 1987, which saw the Dow Jones Industrial Average plunge by more than 22%;
The dot-com bubble burst in the early 2000s.
Additionally, there have been numerous smaller-scale market downturns and corrections over the years. The frequency of stock market crashes varies, with some occurring as a result of economic downturns or systemic issues, while others are sparked by specific events or financial bubbles.
While market crashes are part of the market cycle, they are typically followed by periods of recovery and long-term growth.
23) Over the last 10 years, 82% of fund managers failed to beat the market
The majority of active mutual fund managers are not performing as well as the S&P 500 and the Dow, with over 75% falling behind.
According to the S&P Indices versus Active (SPIVA) scorecard, which compares the performance of active funds with their category benchmarks, 79% of fund managers did not perform as well as the S&P.
It is becoming common to witness more mutual funds disappearing. For instance, in the last 15 years, around 60% of US domestic equity funds, almost 50% of global/international equity funds, and 50% of fixed-income (bond) funds were either merged or liquidated.
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24) The 2000 Dotcom Crash wiped out 40% of the stock market's value
The 2000 Dotcom Crash stands as a striking reminder of the volatility and risks associated with speculative investment bubbles.
During the late 1990s, the rapid growth of internet-based companies led to a surge in investor enthusiasm, driving stock prices to astronomical levels. However, the euphoria was short-lived, and the bubble burst in 2000, resulting in a significant market downturn.
The crash wiped out approximately 40% of the market's value, causing widespread losses for investors and signaling the end of the dot-com era.
The aftermath of the crash prompted a reassessment of valuation methods and investment strategies, emphasizing the importance of sound fundamentals and realistic expectations in the face of market exuberance.
25) Which is number 1 in the stock market?
The largest stock market in the world by market cap is the New York Stock Exchange (NYSE). The NYSE is one of the oldest and most prestigious stock exchanges globally, with a rich history dating back to 1792.
It is home to many of the world's largest and most influential companies, including technology giants, financial institutions, and multinational corporations.
26) Ticker Tape Parade origins
Ever wondered why victorious individuals are honored with ticker tape parades? It all started in 1886 when the New York Stock Exchange began using a new telegraph system.
Ticker tape was the thin strip of paper that displayed stock information, and when the market closed, the excess tape was thrown out of the windows to commemorate the dedication of the Statue of Liberty.
Reading the Ticker Tape. Image by Julie Bang © Investopedia 2019
27) The Great Depression's influence
During the Great Depression, the stock market experienced one of its darkest periods. The market crash of 1929 led to widespread panic, resulting in a significant economic downturn.
However, it also paved the way for the creation of the U.S. Securities and Exchange Commission (SEC), which regulates the official stock exchange to this day.
28) The mysterious ghost stock
Ever heard of the "phantom stock" scandal of the 1960s? It involved brokers secretly trading non-existent stocks and manipulating prices. This scandal brought attention to the need for better market regulation and investor protection.
29) The shortest stock market crash
On May 6, 2010, the stock market witnessed a historic flash crash. Within minutes, the Dow Jones Industrial Average plunged nearly 1,000 points, only to recover most of its losses just as quickly. This event raised concerns about the impact of automated trading systems on market stability.
30) The largest IPO in history
The Saudi Arabian oil company, Saudi Aramco, holds the record for the largest initial public offering (IPO) in history. When it went public in 2019, it raised a staggering $29.4 billion.
31) The lure of the number 7
The number 7 has a peculiar fascination in the stock market. Numerous stock exchanges, including the New York Stock Exchange and Nasdaq, have trading floors that are considered lucky if they are on the 7th floor.
Some traders are incredibly superstitious. They believe that certain rituals, lucky charms, or even wearing the same clothes every trading day can bring them good fortune in the market.
32) The Nasdaq's origin
The Nasdaq stock exchange, known for its high-tech and growth-oriented companies, started as a simple quotation system in 1971. It evolved into a fully-fledged exchange that lists some of the world's most innovative companies.
33) The birth of the Bull and Bear
The terms "bull market" and "bear market" have become synonymous with optimism and pessimism in the stock market.
The origin of these terms can be traced back to the way each animal attacks its prey. A bull thrusts its horns upward, symbolizing a rising market, while a bear swipes its paws downward, symbolizing a declining market.
The iconic Charging Bull statue in New York City's Financial District was created by artist Arturo Di Modica. It was installed as a symbol of optimism and resilience following the 1987 stock market crash.
34) The Billion-Dollar trading error
The consequences of typos can be enormous. Recently, a stock trader at the multinational investment bank Citigroup caused a market upheaval due to a single erroneous input.
The trader accidentally placed a sell order that was much larger than intended, causing a "flash crash" and leading to panic among trading floors throughout Europe. As a result, the stock market value decreased by €300 billion within a few minutes.
35) The strange world of penny stocks
Penny stocks, typically priced under $1 per share, can be incredibly volatile and risky. However, did you know that some well-known companies, including Ford and General Motors, were once penny stocks?
It's a reminder that even the biggest players in the market had humble beginnings.
36) The Millionaire Janitor
Ronald Read was a retired janitor and gas station attendant based in Vermont who had amassed a fortune of 8 million dollars.
He grew his savings over many years by regularly investing small amounts in different companies, even though he never invested a large sum at once.
This demonstrated how stock ownership can create life-changing opportunities for everyone.
37) The bizarre "Dead Cat Bounce"
"Dead cat bounce" is a term used to describe a temporary recovery in the stock market after a significant decline. The analogy suggests that even a dead cat will bounce if it falls from a great height.
Although morbid, it highlights the unpredictability and occasional temporary reprieves in stock market downturns.
38) The rise of online trading
Before the internet era, stock trading was primarily conducted through traditional brokers. However, the rise of online trading platforms in the 1990s revolutionized the industry, making it more accessible to individual investors and fueling a surge in retail trading.
39) The allure of dividend aristocrats
Dividend Aristocrats are companies that have consistently increased their dividend payments for at least 25 consecutive years.
These individual stocks are highly sought after by income-focused investors who value stable and growing cash flows. Companies like Coca-Cola (KO), Walmart (WMT), and Johnson & Johnson (JNJ) are well-known examples of Dividend Aristocrats.
40) The extraordinary power of compound interest
Albert Einstein once called compound interest the "eighth wonder of the world". It has the remarkable ability to turn small investments into substantial wealth over time. This underlines the importance of long-term investing and the potential benefits of starting early.
The stock market is a treasure trove of intriguing facts and captivating stories. From its origins to the quirks and anomalies that define it today, there's no shortage of surprises to discover.
While stock prices are always shifting, there are countless opportunities available for making investments.
We hope that these 40 Interesting Stock Market Facts have shed light on some intriguing details that will guide you through your investing journey and propel you toward success.
Did we miss any other fun facts? If you know of any other interesting U.S. stock market facts or stories, write them in the comments down below!
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