METHOD OF BUSINESS. Stock exchanges as at present constituted are limited in member ship and governed by strict rules which cover both methods of business, rates of commission to be charged, and conduct on the floor. The rules governing methods of business in New York prescribe a minimum commission of one eighth of one per cent. on the face value of securities purchased for outside customers, one thirty-second of one per cent. for purchases made on account of fellow members, and one fiftieth of one per cent. for• purchases made on the order of another member on the floor.
In London commissions vary from Is. per hundred to 2s. Gd. per hundred, according to the nature of the security. The Paris agents de change charge one-fourth of one per cent. In New York the Stock Exchange member may both transact business on the floor of the Stock Exchange and solicit business from outside cus tomers. In London these functions are divided between the two functionaries known as `jobber' and 'broker,' which correspond roughly to the divisions in other English professions, as, for instance, the barrister and solicitor in law. Members of the London Stock Exchange are for bidden to advertise: New York Stock Exchange houses advertise freely. Agents de change in
Paris are forbidden to solicit outside business.
Acceptance of a bid or offer of stock makes the transaction official on a stock exchange and binds each participant to the fulfillment of his bargain. Stocks thus sold must be delivered to the buyer by 2:15 P.M. of the ensuing clay. The New York Stock Exchange practices daily set tlement of such accounts. In London settle ments are made fortnightly, the bargain being carried for the account, that is to say, on credit, during the intervening period.
No security may be dealt in on the Stock Exchange which has not been formally `listed' by the committee. In New York a statement of the company's condition, with a balance-sheet, is required before listing; also proof that proper facilities for transfer and registry of shares have been provided, and that with bonds the mortgage has been properly drawn and recorded. Corporations unwilling to make public state ings on the New York Stock Exchange in recent years have been as shown in the preceding table, GO to 70 per cent. being securities issued to re place others formerly listed.