Closing Bell - Explained
What is the Closing Bell?
Written by J. Mance Gordon
Updated at April 23rd, 2024
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What is the Closing Bell?
The closing bell is a term used in the stock exchange market to describe the end of a trading session. In a typical stock exchange, the closing bell rings signaling the end of trading activities on a stock exchange. It is a traditional bell that rings to tell traders to end the trade of securities for a particular trading day. The closing bell is not used in all exchanges. The New York Stock Exchange uses this bell on a daily basis signifying that trading for the day has ended. 4:00 p.m. EST (Eastern Standard Time) is the time the closing bell rings at the NYSE.
How Does the Closing Bell Work?
In the stock exchange, the closing bell is a traditional system in which a bell rings at a stipulated time to tell traders that trading activities for the day have ended. Whether rung traditionally (by hand) or electronically, the closing bell is audible to all traders in the marketplace. Before 1903, the NYSE uses a traditional gong to signal the end of a trading day, at the present moment, NYSE uses a brass bell which is now controlled electrically. Before 1995, ringing the closing bell was the duty of the floor managers because there are bells located on each section of the NYSE.
What the Closing Bell Represents
Aside from the NYSE, there are other stock exchanges that use the closing bell, such as the Nasdaq Stock Market. However, many other exchanges do not use actual bells when signaling the end of trading activities for a particular trade. Furthermore, the closing bell is now a term being used in other industries such as the media.