The Nasdaq Stock Market or NASDAQ, 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. The exchange platform is owned by Nasdaq, Inc., which also owns the Nasdaq Nordic stock market network and several U.S. stock and options exchanges.
Nasdaq was initially an acronym for the National Association of Securities Dealers Automated Quotations.
It was founded in 1971 by the National Association of Securities Dealers (NASD), now known as the Financial Industry Regulatory Authority (FINRA).
On February 8, 1971, the Nasdaq stock market began operations as the world's first electronic stock market. At first, it was merely a quotation system and did not provide a way to perform electronic trades.
The Nasdaq Stock Market helped lower the bid–ask spread, the price difference between sellers and buyers, but was unpopular among brokers as it reduced their profits.
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 and also in the monthly Stock Guides, stock guides and procedures, issued by Standard & Poor's Corporation.
Over the years, the Nasdaq Stock Market became more of a stock market by adding trade and volume reporting and automated trading systems.
More information: NASDAQ
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%.
In 1998, it was the first stock market in the United States to trade online, using the slogan the stock market for the next hundred years. 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.
In 1992, the Nasdaq Stock Market joined with the London Stock Exchange to form the first intercontinental linkage of capital markets.
In 2000, the National Association of Securities Dealers spun off the Nasdaq Stock Market to form a public company.
On July 2, 2002, Nasdaq Inc. became a public company via an initial public offering.
In 2006, the status of the Nasdaq Stock Market was changed from a stock market to a licensed national securities exchange.
In 2007, Nasdaq merged with OMX, a leading exchange operator in the Nordic countries, expanded its global footprint, and changed its name to the NASDAQ OMX Group.
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).
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.
In 2016, Nasdaq earned $272 million in listings-related revenues.
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.
In December 2020, NASDAQ announced that it would strip its indexes of four Chinese companies in response to Executive Order 13959.
Nasdaq quotes are available at three levels:
-Level 1. Shows the highest bid and lowest ask -inside quote.
-Level 2. Shows all public quotes of market makers together with information of market dealers wishing to buy or sell stock and recently executed orders.
-Level 3. Is used by the market makers and allows them to enter their quotes and execute orders.
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