The first electronic stock market
A NASDAQ case study

Page 1: Introduction

The Nasdaq Stock Market® is a world famous stock market, based in the US. Nasdaq® uses computer and telecommunications networks to trade and monitor thousands of listed stocks, sometimes also referred to as securities. It was the first stock market in the world to trade electronically, as opposed to people dealing from a trading floor in a physical location. Today, Nasdaq’s systems...
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Page 2: Growth and performance

Nasdaq began operating on 8 February 1971 with 250 listed companies. On that day, the Nasdaq Composite Index® started at 100, this index tracks all companies listed on the market. In the period 1989-2000, the US economy experienced almost continuous growth. At the same time, rapid developments in information technology drove down costs for many businesses and improved their competitiveness. As...
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Page 3: Market dirversity

Nasdaq is well known for dealing in high-tech shares and many famous technology companies are listed on the market (eg Apple, Dell, Microsoft, Cisco, Intel). However, Nasdaq also deals in shares of companies from a broad range of market sectors, for example, the retail warehouse chain Costco and Starbucks coffee shop chain. In number, there are indeed many more manufacturing and finance...
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Page 4: Market model

Nasdaq operates a computer screen-based market model: market participants, both registered Market Makers and ECNs (Electronic Communications Networks) communicate through its private network of computer links. Indeed, this network was one of the world’s first business to business intranets. This network broadcasts trading information to over 7,000 terminals at 600 market making firms...
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Page 5: The role of technology

The Internet offers instant global communications. In an increasingly globalised market place, companies often seek to raise capital worldwide. Investors are also becoming less concerned about national frontiers and capital movement is now increasingly more international. The barriers to the free flow of capital are becoming a thing of the past. Investors are now better informed about investment...
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Page 6: Conclusion

The world's first electronic stock market, Nasdaq, now trades more shares in terms of volume and value than any other major exchange in the world. Nasdaq lists a wide range of companies covering the complete economic spectrum from agriculture, mining, construction and manufacturing to transportation, retail, banking, insurance and high tech.Nasdaq has been highly successful in helping to support...
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Related: IMI
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