The Buttonwood Agreement

In 1790, the nation's first Secretary of the Treasury, Alexander Hamilton, issued $80 million in government war bonds to help pay the costs of the Revolutionary War. Shares were sold to the public at $100 each. The first stock was introduced a few years later when Hamilton established the first Bank of the United States. Other banks and insurance company stocks were soon added to the available list of securities. Trading of this government stock, as well as stock in banks and insurance companies, was carried on in various coffeehouses, auction rooms and offices within the city of New York.

In March 1792, twenty-four of New York's leading merchants met secretly at Corre's Hotel to discuss ways to bring order to the securities business. Two months later, on May 17, 1792, these men signed a document called the Buttonwood Agreement, named after their traditional meeting place under a buttonwood tree. The agreement stated that they would only trade securities among themselves, that they would adhere to set commissions and that they would not participate in auctions.

By 1793 there were too many brokers involved to meet under a tree. So they took space in an elaborate structure on the corner of Wall and Water streets, called the Tontine Coffee House. Their new venture was to become the nation's principal securities marketplace - the New York Stock Exchange, which today is only a few blocks from where the old buttonwood tree once grew.

Since 1990, Buttonwood Partners, Inc. has carried on the tradition of the locally owned and operated securities firm.