What is NASDAQ?
NASDAQ you may have heard about it on the radio. Nasdaq is a global electronic marketplace for buying and selling securities. It is also a benchmark index for US stocks it stands for the National Association of Securities. Dealers automated quotations in essence it is a platform on which people trade stocks.
Three main parts make up the Nasdaq Stock Exchange the first of which is that interface. This is simply the place where broker-dealers and traffic controllers gain access to the system the second part is the matching system.
This is a system that matches buyers and sellers when their prices match for example the lowest selling price for a specific stock is 100 shares for $11 per share and the highest buying price is $10.80 for 50 shares at this point. The matching system will determine that there are no matches and bargain sellers will have to continue to wait but knowing there is a new buyer who's willing to pay at eleven dollars and five cents per share for 50 shares the computer will match this person with the person who is planning to sell a hundred shares for eleven dollars each and the buyer will only have to pay $11 per share and both parties are happy.
The seller will be able to sell half of his shares for the price that he wanted to and the buyer will get a slight discount than what he was willing to pay for it that last and most complex part is court services code services uses supply and demand and current pricing information along with several complex algorithms and matching engine data to provide up to a minute price data to the world that's a very simplified version of what the Nasdaq platform does and it's very similar to the New York Stock Exchange.
It was the first recognized electronic stock market in other words you don't have to go to a physical location to trade stocks like we're the New York Stock Exchange. NASDAQ traffic controllers are known as market makers and actively buy and sell stock on behalf of traders.
New York Stock Exchange traffic controllers on the other hand are known as specialists they said opening price super stocks accept limit orders and moderate interest on particular stocks. Nasdaq market makers like the name suggest creating a full market while New York Stock Exchange specialists simply facilitate a market. Nasdaq is also more computerized in the New York Stock Exchange about 40% of the volume that is traded through Nasdaq is done.
This is a system that matches buyers and sellers when their prices match for example the lowest selling price for a specific stock is 100 shares for $11 per share and the highest buying price is $10.80 for 50 shares at this point. The matching system will determine that there are no matches and bargain sellers will have to continue to wait but knowing there is a new buyer who's willing to pay at eleven dollars and five cents per share for 50 shares the computer will match this person with the person who is planning to sell a hundred shares for eleven dollars each and the buyer will only have to pay $11 per share and both parties are happy.
The seller will be able to sell half of his shares for the price that he wanted to and the buyer will get a slight discount than what he was willing to pay for it that last and most complex part is court services code services uses supply and demand and current pricing information along with several complex algorithms and matching engine data to provide up to a minute price data to the world that's a very simplified version of what the Nasdaq platform does and it's very similar to the New York Stock Exchange.
It was the first recognized electronic stock market in other words you don't have to go to a physical location to trade stocks like we're the New York Stock Exchange. NASDAQ traffic controllers are known as market makers and actively buy and sell stock on behalf of traders.
New York Stock Exchange traffic controllers on the other hand are known as specialists they said opening price super stocks accept limit orders and moderate interest on particular stocks. Nasdaq market makers like the name suggest creating a full market while New York Stock Exchange specialists simply facilitate a market. Nasdaq is also more computerized in the New York Stock Exchange about 40% of the volume that is traded through Nasdaq is done.
Difference between NASDAQ and NYSE
Through ECNs or electronic communication networks only about 7% of blindness traded on the New York Stock Exchange is done through easy ends, there are also huge listing requirement differences between the two to lists on NASDAQ a company must offer 1.25 million shares for the public to trade but a company listing on the New York Stock Exchange must only have 1.1 million shares that are held by at least 400 shareholders also.
New York Stock Exchange-listed companies must have at least a per-share value of $4 and a market value of at least 40 million dollars you need a lot more upfront capital to be able to list on the New York Stock Exchange there is about a 500,000 dollar fee to enter the New York Stock Exchange. There's only a 50 to $75 fee to enter Nasdaq caliber but there is a yearly fee of about 27 thousand dollars. Another difference between two is a type of stock that are generally listed on them.
The New York Stock Exchange generally has more stable and less volatile stocks than Nasdaq for example the New York Stock Exchange has stock from companies such as coca-cola, Walmart, and Citigroup which are unlikely to change a whole lot in a given day. NASDAQ stocks on the other hand are usually tech companies that can fluctuate a law on a given day like Facebook, Apple, Google, and Amazon. Apple stock may soar the day before an iPhone release but then plummet. If there are disappointing sales so NASDAQ stocks are generally more volatile so this is where you want a good for try to make it quick but it makes lookout for those short-term capital gain taxes which can be quite high that's just the first part of Nasdaq.
The New York Stock Exchange generally has more stable and less volatile stocks than Nasdaq for example the New York Stock Exchange has stock from companies such as coca-cola, Walmart, and Citigroup which are unlikely to change a whole lot in a given day. NASDAQ stocks on the other hand are usually tech companies that can fluctuate a law on a given day like Facebook, Apple, Google, and Amazon. Apple stock may soar the day before an iPhone release but then plummet. If there are disappointing sales so NASDAQ stocks are generally more volatile so this is where you want a good for try to make it quick but it makes lookout for those short-term capital gain taxes which can be quite high that's just the first part of Nasdaq.
Though there's also Nasdaq Composite and Nasdaq 100 now as a composite is a benchmark index or like Dow Jones but there are a couple of differences first of all Nasdaq index values created from a lot more company than Dow Jones which will only be based on 30 companies. Dow Jones Industrial Average tracks at the top 30 countries in the respective industries most of these companies are traded on the New York Stock Exchange and only a couple are traded on NASDAQ these companies include Apple Cisco Intel and Microsoft.
Nasdaq Composite on the other hand tracks all of the companies that are traded on the Nasdaq platform most of the countries that make up the Nasdaq Composite for technology and Internet-related companies. One similarity between the two these investors cannot trade Dow Jones or the Nasdaq Composite but they can buy index fonts or exchange-traded funds that track either one Nasdaq 100 is a stock market index made up of 103 equity securities Nasdaq Composite and Nasdaq 100 are simply stock market indices like S&P 500 or Dow Jones now don't mess this up with n deck which to stock that you can buy and DAC is a stock of the company that manages the Nasdaq platform.
Now it is a big beautiful buy and act doctor you were essentially buying the stock of a company that makes money for people like you buying a stock of other companies and you can bet that Nasdaq also makes money on buying and selling fees when you buy your stock considering that Nasdaq is computerized have there ever been big issues for the whole system of shutting down and answer to that is yes but it is very rare.
The last time that Nasdaq shut down due to computer-related issues was on August 22nd, 2013 so a while ago and even during the shutdown it was only shut down for a total of three hours and 11 minutes a very short period. As a result other than such rare occurrences the system is very reliable in the end when someone is referred back they referred to one of three things they may be referred to a NASDAQ security exchange platform in which company stock is traded or they may be referring to end AK which is the stock of the company that owns the Nasdaq platform.
The last time that Nasdaq shut down due to computer-related issues was on August 22nd, 2013 so a while ago and even during the shutdown it was only shut down for a total of three hours and 11 minutes a very short period. As a result other than such rare occurrences the system is very reliable in the end when someone is referred back they referred to one of three things they may be referred to a NASDAQ security exchange platform in which company stock is traded or they may be referring to end AK which is the stock of the company that owns the Nasdaq platform.
But they are probably referring to Nasdaq Composite and the state of the market as a whole so next time you hear about or see Nasdaq you have a good idea of what they're talking about.
Thank You
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