Nasdaq

Last updated

National Association of Securities Dealers Automated Quotations (Nasdaq)
NASDAQ Logo.svg
Type Stock exchange
Location New York City, U.S.
FoundedFebruary 8, 1971;51 years ago (1971-02-08)
Owner Nasdaq, Inc.
Currency United States dollar
No. of listings3,554 [1]
Market cap Decrease2.svg $19.4 trillion (2021) [2]
Indices
Website www.nasdaq.com
Nasdaq laea location map.svg
Red pog.svg
Red pog.svg
Red pog.svg
Red pog.svg
Red pog.svg
Red pog.svg
Red pog.svg
Red pog.svg
Red pog.svg
Red pog.svg
class=notpageimage|
Stock exchanges (listing venues) owned by Nasdaq, Inc..

The Nasdaq Stock Market ( /ˈnæzdæk/ ( Loudspeaker.svg listen )) (National Association of Securities Dealers Automated Quotations Stock Market) is an American stock exchange based in New York City. It is ranked second on the list of stock exchanges by market capitalization of shares traded, behind the New York Stock Exchange. [3] The exchange platform is owned by Nasdaq, Inc., [4] which also owns the Nasdaq Nordic stock market network and several U.S.-based stock and options exchanges.

Contents

History

1971–2000

Former logo used from 1971 to 2014 NASDAQ.svg
Former logo used from 1971 to 2014

"Nasdaq" was initially an acronym for the National Association of Securities Dealers Automated Quotations. [5] It was founded in 1971 by the National Association of Securities Dealers (NASD), now known as the Financial Industry Regulatory Authority (FINRA). [6] On February 8, 1971, the Nasdaq stock market began operations as the world's first electronic stock market. [6] At first, it was merely a "quotation system" and did not provide a way to perform electronic trades. [7]

The NASDAQ Stock Market eventually assumed the majority of major trades that had been executed by the over-the-counter (OTC) system of trading, but there are still many securities traded in this fashion. As late as 1987, the Nasdaq exchange was still commonly referred to as "OTC" in media reports [8] and also in the monthly Stock Guides (stock guides and procedures) issued by Standard & Poor's Corporation. [9] Over the years, it became more of a stock market by adding trade and volume reporting and automated trading systems. In 1981, Nasdaq traded 37% of the U.S. securities markets' total of 21 billion shares. By 1991, Nasdaq's share had grown to 46%. [10] In 1992, the Nasdaq Stock Market joined with the London Stock Exchange to form the first intercontinental linkage of capital markets. [11] In 1998, it became the first stock market in the United States to trade online, using the slogan "the stock market for the next hundred years". [12] The Nasdaq Stock Market attracted many companies during the dot-com bubble.

Its main index is the NASDAQ Composite, which has been published since its inception. The QQQ exchange-traded fund tracks the large-cap NASDAQ-100 index, which was introduced in 1985 alongside the NASDAQ Financial-100 Index, which tracks the largest 100 companies in terms of market capitalization.

2000–present

During the dot-com bubble, the NASDAQ Composite index spiked in the late 1990s. It then fell sharply as the bubble burst. Nasdaq Composite dot-com bubble.svg
During the dot-com bubble, the NASDAQ Composite index spiked in the late 1990s. It then fell sharply as the bubble burst.
Studio NASDAQ Market Site 201506.jpg
Studio

On March 10, 2000, the NASDAQ Composite stock market index peaked at 5,132.52, but fell to 3,227 by April 17, [13] and, in the following 30 months, fell 78% from its peak. [14]

In a series of sales in 2000 and 2001, FINRA sold its stake in the Nasdaq. On July 2, 2002, Nasdaq Inc. became a public company via an initial public offering. [15] In 2006, the status of the Nasdaq Stock Market was changed from a stock market to a licensed national securities exchange. [16] In 2007, it merged with OMX, a leading exchange operator in the Nordic countries, expanded its global footprint, and changed its name to the NASDAQ OMX Group. [17]

To qualify for listing on the exchange, a company must be registered with the United States Securities and Exchange Commission (SEC), must have at least three market makers (financial firms that act as brokers or dealers for specific securities) and must meet minimum requirements for assets, capital, public shares, and shareholders.

In February 2011, in the wake of an announced merger of NYSE Euronext with Deutsche Börse, speculation developed that NASDAQ OMX and Intercontinental Exchange (ICE) could mount a counter-bid of their own for NYSE. NASDAQ OMX could be[ when? ] looking to acquire the American exchange's cash equities business, ICE the derivatives business. At the time, "NYSE Euronext's market value was $9.75 billion. Nasdaq was valued at $5.78 billion, while ICE was valued at $9.45 billion." [18] Late in the month, Nasdaq was reported to be considering asking either ICE or the Chicago Mercantile Exchange to join in what would probably have to be, if it proceeded, an $11–12 billion counterbid. [19]

In December 2005, NASDAQ acquired Instinet for $1.9 billion, retaining the Inet ECN and subsequently selling the agency brokerage business to Silver Lake Partners and Instinet management. [20] [21] [22]

The European Association of Securities Dealers Automatic Quotation System (EASDAQ) was founded as a European equivalent to the Nasdaq Stock Market. It was purchased by NASDAQ in 2001 and became NASDAQ Europe. In 2003, operations were shut down as a result of the burst of the dot-com bubble. [23] In 2007, NASDAQ Europe was revived first as Equiduct and was acquired by Börse Berlin later that year. [24]

On June 18, 2012, Nasdaq OMX became a founding member of the United Nations Sustainable Stock Exchanges Initiative on the eve of the United Nations Conference on Sustainable Development (Rio+20). [25] [26]

In November 2016, chief operating officer Adena Friedman was promoted to chief executive officer, becoming the first woman to run a major exchange in the U.S. [27]

In 2016, Nasdaq earned $272 million in listings-related revenues. [28]

In October 2018, the SEC ruled that the New York Stock Exchange and Nasdaq did not justify the continued price increases when selling market data. [29] [30] [31]

In December 2020, NASDAQ announced that it would strip its indexes of four Chinese companies in response to Executive Order 13959. [32]

Contract Specifications

Nasdaq 100 futures are traded on the CME (Chicago Merchantile Exchange), and E-Mini Nasdaq 100 futures are traded on the EMiniCME. [33] [34] Below are the CQG contract specifications for the nasdaq 100 and emini nasdaq.

CQG Contract Specifications [33] [34]
Nasdaq 100E Mini Nasdaq 100
Exchange:CMEEMiniCME
Sector:IndexIndex
Tick Size:0.250.25
Tick Value:25 USD5 USD
BPV:10020
Denomination:USDUSD
Decimal Place:22

Quote availability

Nasdaq quotes are available at three levels:

Trading schedule

The Nasdaq Stock Market sessions, with times in the Eastern Time Zone are:

7:00 a.m. to 9:30 a.m.: extended-hours trading session (premarket)

9:30 a.m. to 4:00 p.m.: normal trading session

4:00 p.m. to 8:00 p.m.: extended-hours trading session (postmarket) [37]

The Nasdaq Stock Market averages about 253 trading days per year.[ citation needed ]

Market tiers

The Nasdaq Stock Market has three different market tiers:

See also

Related Research Articles

New York Stock Exchange American stock exchange

The New York Stock Exchange is an American stock exchange in the Financial District of Lower Manhattan in New York City. It is by far the world's largest stock exchange by market capitalization of its listed companies at US$30.1 trillion as of February 2018. The average daily trading value was approximately US$169 billion in 2013. The NYSE trading floor is at the New York Stock Exchange Building on 11 Wall Street and 18 Broad Street and is a National Historic Landmark. An additional trading room, at 30 Broad Street, was closed in February 2007.

Stock market Place where stocks are traded

A stock market, equity market, or share market is the aggregation of buyers and sellers of stocks, which represent ownership claims on businesses; these may include securities listed on a public stock exchange, as well as stock that is only traded privately, such as shares of private companies which are sold to investors through equity crowdfunding platforms. Investment is usually made with an investment strategy in mind.

S&P 500 Stock market index

The Standard and Poor's 500, or simply the S&P 500, is a stock market index tracking the stock performance of 500 large companies listed on exchanges in the United States. It is one of the most commonly followed equity indices. As of December 31, 2020, more than $5.4 trillion was invested in assets tied to the performance of the index.

Australian Securities Exchange Australian public company

Australian Securities Exchange Ltd or ASX, is an Australian public company that operates Australia's primary securities exchange, the Australian Securities Exchange. The ASX was formed on 1 April 1987, through incorporation under legislation of the Australian Parliament as an amalgamation of the six state securities exchanges, and merged with the Sydney Futures Exchange in 2006.

The Nasdaq-100 (^NDX) is a stock market index made up of 102 equity securities issued by 101 of the largest non-financial companies listed on the Nasdaq stock exchange. It is a modified capitalization-weighted index. The stocks' weights in the index are based on their market capitalizations, with certain rules capping the influence of the largest components. It is limited to companies from a single exchange, and it does not have any financial companies. The financial companies are in a separate index, the NASDAQ Financial-100.

An exchange-traded fund (ETF) is a type of investment fund and exchange-traded product, i.e. they are traded on stock exchanges. ETFs are similar in many ways to mutual funds, except that ETFs are bought and sold from other owners throughout the day on stock exchanges whereas mutual funds are bought and sold from the issuer based on their price at day's end. An ETF holds assets such as stocks, bonds, currencies, futures contracts, and/or commodities such as gold bars, and generally operates with an arbitrage mechanism designed to keep it trading close to its net asset value, although deviations can occasionally occur. Most ETFs are index funds: that is, they hold the same securities in the same proportions as a certain stock market index or bond market index. The most popular ETFs in the U.S. replicate the S&P 500 Index, the total market index, the NASDAQ-100 index, the price of gold, the "growth" stocks in the Russell 1000 Index, or the index of the largest technology companies. With the exception of non-transparent actively managed ETFs, in most cases, the list of stocks that each ETF owns, as well as their weightings, is posted daily on the website of the issuer. The largest ETFs have annual fees of 0.03% of the amount invested, or even lower, although specialty ETFs can have annual fees well in excess of 1% of the amount invested. These fees are paid to the ETF issuer out of dividends received from the underlying holdings or from selling assets.

Singapore Exchange Investment holding company in Singapore

The Singapore Exchange Limited (SGX) is an investment holding company located in Singapore and provides different services related to securities and derivatives trading and others. SGX is also a member of the World Federation of Exchanges and the Asian and Oceanian Stock Exchanges Federation.

Wilshire 5000 Stock market index

The Wilshire 5000 Total Market Index, or more simply the Wilshire 5000, is a market-capitalization-weighted index of the market value of all American-stocks actively traded in the United States. As of March 31, 2022, the index contained 3,660 components. The index is intended to measure the performance of most publicly traded companies headquartered in the United States, with readily available price data,. Hence, the index includes a majority of the common stocks and REITs traded primarily through New York Stock Exchange, NASDAQ, or the American Stock Exchange. Limited partnerships and ADRs are not included. It can be tracked by following the ticker ^W5000.

Osaka Exchange Japanese securities exchange located in Osaka

Osaka Exchange, Inc., renamed from Osaka Securities Exchange Co., Ltd., is the largest derivatives exchange in Japan, in terms of amount of business handled.

Shanghai Stock Exchange Stock exchange in Shanghai, China

The Shanghai Stock Exchange (SSE) is a stock exchange based in the city of Shanghai, China. It is one of the three stock exchanges operating independently in mainland China, the others being the Beijing Stock Exchange and the Shenzhen Stock Exchange. The Shanghai Stock Exchange is the world's 3rd largest stock market by market capitalization at US$7.62 trillion as of July 2021. It is also Asia's biggest stock exchange. Unlike the Hong Kong Stock Exchange, the Shanghai Stock Exchange is still not entirely open to foreign investors and often affected by the decisions of the central government, due to capital account controls exercised by the Chinese mainland authorities.

Nasdaq, Inc. American multinational financial services corporation

Nasdaq, Inc. is an American multinational financial services corporation that owns and operates three stock exchanges in the United States: the namesake Nasdaq stock exchange, the Philadelphia Stock Exchange, and the Boston Stock Exchange, and seven European stock exchanges: Nasdaq Copenhagen, Nasdaq Helsinki, Nasdaq Iceland, Nasdaq Riga, Nasdaq Stockholm, Nasdaq Tallinn, and Nasdaq Vilnius. It is headquartered in New York City, and its president and chief executive officer is Adena Friedman.

NYSE Arca American stock exchange

NYSE Arca, previously known as ArcaEx, an abbreviation of Archipelago Exchange, is an exchange on which both stocks and options are traded. It was owned by Intercontinental Exchange. It merged with the New York Stock Exchange in 2006 and now operates as a subsidiary of the NYSE Group, Inc. It is headquartered in Chicago.

Indonesia Stock Exchange Stock exchange

Indonesia Stock Exchange is a stock exchange based in Jakarta, Indonesia. It was previously known as the Jakarta Stock Exchange (JSX) before its name changed in 2007 after merging with the Surabaya Stock Exchange (SSX). During recent years, Indonesia Stock Exchange sees fastest membership growth in Asia. As of September 2021, the Indonesia Stock Exchange had 750 listed companies, and total stock investors were about 6.4 million, compared to 2.5 million at the end of 2019.. Indonesia Market Capitalization accounted for 45.2% of its Nominal GDP in Dec 2020.

A capitalization-weightedindex, also called a market-value-weighted index is a stock market index whose components are weighted according to the total market value of their outstanding shares. Every day an individual stock's price changes and thereby changes a stock index's value. The impact that individual stock's price change has on the index is proportional to the company's overall market value, in a capitalization-weighted index. In other types of indices, different ratios are used.

Options Clearing Corporation Financial services business

Options Clearing Corporation (OCC) is a United States clearing house based in Chicago. It specializes in equity derivatives clearing, providing central counterparty (CCP) clearing and settlement services to 16 exchanges. Started by Wayne Luthringshausen and carried on by Michael Cahill. Instruments include options, financial and commodity futures, security futures and securities lending transactions.

The Nasdaq Composite is a stock market index that includes almost all stocks listed on the Nasdaq stock exchange. Along with the Dow Jones Industrial Average and S&P 500, it is one of the three most-followed stock market indices in the United States. The composition of the NASDAQ Composite is heavily weighted towards companies in the information technology sector. The Nasdaq-100, which includes 100 of the largest non-financial companies in the Nasdaq Composite, accounts for over 90% of the movement of the Nasdaq Composite.

The NYSE Composite (^NYA) is a stock market index covering all common stock listed on the New York Stock Exchange, including American depositary receipts, real estate investment trusts, tracking stocks, and foreign listings. It includes corporations in each of the ten industries listed in the Industry Classification Benchmark. It uses free-float market cap weighting.

Inet was an electronic trading platform based on a system developed by Instinet in the 1970s that merged with Island ECN in 2002 and was subsequently acquired by NASDAQ in 2005.

References

  1. ↑ "Nasdaq Companies". Archived from the original on August 6, 2019.
  2. ↑ "Market Statistics - Focus". focus.world-exchanges.org. The World Federation of Exchanges. March 2021. Retrieved April 14, 2021.
  3. ↑ "Monthly Reports". World-Exchanges.org. World Federation of Exchanges. Archived from the original on August 17, 2014.
  4. ↑ "Nasdaq – Business Solutions & Services". nasdaq.com. Archived from the original on October 20, 2016. Retrieved June 16, 2016.
  5. ↑ Frequently Asked Questions. NASDAQ.com. NASDAQ, n.d. Web. December 23, 2001. Archived April 29, 2010, at the Wayback Machine
  6. 1 2 Terrell, Ellen. "History of the American and Nasdaq Stock Exchanges". Library of Congress. Archived from the original on April 14, 2013.
  7. ↑ KENNON, JOSHUA (March 26, 2019). "What Is the NASDAQ?". Dotdash .
  8. ↑ Gilpin, Kenneth N. (July 3, 1987). "Company News: An Erratic Quarter for Stock Markets" . The New York Times . ISSN   0362-4331. Archived from the original on August 1, 2017.
  9. ↑ Salinger, Lawrence M. (June 14, 2013). Encyclopedia of White-Collar and Corporate Crime. SAGE Publications. ISBN   978-1-4522-7616-8.
  10. ↑ WIDDER, PAT (May 24, 1992). "NASDAQ HAS EYE ON NEXT 100 YEARS". Chicago Tribune .
  11. ↑ Odekon, Mehmet (March 17, 2015). Booms and Busts: An Encyclopedia of Economic History from the First Stock Market Crash of 1792 to the Current Global Economic Crisis: An Encyclopedia of Economic History from the First Stock Market Crash of 1792 to the Current Global Economic Crisis. Routledge. ISBN   9781317475750. Archived from the original on August 3, 2017.
  12. ↑ "Feb 8, 1971 CE: 'Stock Market for the Next 100 Years' Opens". National Geographic. Archived from the original on July 19, 2016. Retrieved September 16, 2019.
  13. ↑ "NASDAQ Composite daily index". Archived from the original on November 22, 2010.
  14. ↑ Glassman, James K. (February 11, 2015). "3 Lessons for Investors From the Tech Bubble". Kiplinger's Personal Finance . Archived from the original on April 15, 2017.
  15. ↑ "INVESTOR FAQS". Nasdaq.
  16. ↑ Walsh, Michelle. "Nasdaq Stock Market Becomes A National Securities Exchange; Changes Market Designations". Archived from the original on December 17, 2013.
  17. ↑ Lucchetti, Aaron; MacDonald, Alistair (May 26, 2007). "Nasdaq Lands OMX for $5.7 Billion; Are More Merger Deals on the Way?". The Wall Street Journal . ISSN   0099-9660. Archived from the original on July 31, 2017.
  18. ↑ De la Merced, Michael J., "Nasdaq and ICE Hold Talks Over Potential N.Y.S.E. Bid" Archived January 20, 2012, at the Wayback Machine , The New York Times Dealbook, February 18, 2011.
  19. ↑ Fraser, Michelle E., "Nasdaq May Ask CME or ICE for Help in NYSE Counterbid, WSJ Says" Archived July 29, 2014, at the Wayback Machine , Bloomberg News, February 26, 2011.
  20. ↑ "NASDAQ COMPLETES ACQUISITION OF INET" (Press release). Nasdaq. December 8, 2005.
  21. ↑ Authers, John (December 8, 2005). "Nasdaq completes purchase of Instinet exchange" . Financial Times .
  22. ↑ "Nasdaq to Acquire Instinet in $1.9 Billion Deal" . The New York Times . April 22, 2005. ISSN   0362-4331.
  23. ↑ "Nasdaq Might Shut Down German Exchange". Deutsche Welle . August 11, 2003.
  24. ↑ "Easdaq Makes A Comeback As Equiduct". Archived from the original on January 6, 2011. Retrieved February 3, 2011.
  25. ↑ "SUSTAINABLE STOCK EXCHANGES INITIATIVE: EXCHANGES LISTING OVER 4,600 COMPANIES COMMIT TO PROMOTING SUSTAINABILITY" (Press release). GlobeNewswire. June 18, 2012. Archived from the original on December 6, 2019. Retrieved September 16, 2019.
  26. ↑ JUNGCURT, STEFAN (June 29, 2012). "Five Stock Exchanges Commit to Promoting Sustainability". International Institute for Sustainable Development .
  27. ↑ "Nasdaq's New CEO Attributes Her Success to an 'Eclectic' Career Path". Fortune . November 15, 2016. Archived from the original on November 17, 2016.
  28. ↑ Osipovich, Alexander (October 26, 2017). "Startup Exchange Cleared to Take on NYSE, Nasdaq for Stock Listings" . The Wall Street Journal . Archived from the original on October 26, 2017.
  29. ↑ Osipovich, Alexander; Michaels, Dave; Morgenson, Gretchen (October 16, 2018). "SEC Ruling Takes Aim at Stock-Exchange Profits" . The Wall Street Journal .
  30. ↑ "SEC rules NYSE and Nasdaq did not justify data fee increases" . Financial Times . October 16, 2018.
  31. ↑ Michaels, Dave (October 19, 2018). "NYSE, Nasdaq Take It on the Chin in Washington" . The Wall Street Journal . ISSN   0099-9660.
  32. ↑ Singh, Kanishka; Kerber, Ross (December 12, 2020). "Nasdaq to remove four Chinese companies' shares from indexes after U.S. order". Reuters . Retrieved December 16, 2020.
  33. 1 2 "Historical Nasdaq 100 Intraday Futures Data (NDA)". PortaraCQG. Retrieved April 29, 2022.
  34. 1 2 "Historical E Mini Nasdaq 100 Intraday NQ/ENQ Futures Data". PortaraCQG. Retrieved April 29, 2022.
  35. ↑ "Order Book, Level 2 Market Data, and Depth of Market". Daytrading. About.com. Archived from the original on January 14, 2011.
  36. ↑ "Nasdaq Level III Quote". Archived from the original on April 13, 2014.
  37. ↑ "Nasdaq Trading Schedule". Nasdaq.com. Archived from the original on April 17, 2014.
  38. ↑ "Definition of 'Nasdaq SmallCap Market', now known as Nasdaq Capital Market". Investopedia. Archived from the original on August 4, 2013.
  39. ↑ "Definition of 'Nasdaq Global Market Composite'". Investopedia. Archived from the original on September 17, 2013.
  40. ↑ "Definition of 'Nasdaq Global Select Market Composite'". Investopedia. Archived from the original on October 4, 2013.
  41. ↑ Pinto, Jerald E.; Henry, Elaine; Robinson, Thomas R.; Stowe, John D. (2010). Equity Asset Valuation. CFA Institute Investment Series. Vol. 27 (2 ed.). John Wiley & Sons. p. 6. ISBN   9780470579657. Archived from the original on May 10, 2013. [...] NASDAQ-GS stands for 'Nasdaq Global Select Market,' [...]
This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.