NASDAQ stock market is a stock exchange market in the US. NASDAQ is an acronym that stands for “National Association of Securities Dealers Automated Quotations”. Trading in this market is done electronically and investors are able to view how the stocks are fairing via a screen. It is by far the biggest exchange market in the United States and second largest with regard to market capitalization throughout the world. In the month of January 2011 this market had 2,872 listings. Compared to other electronic stock exchange markets NASDAQ tops the list in terms of the volumes it trades.
NASDAQ was started by the National Association of Securities Dealers (NASD) in 1971. Financial Industry Regulatory Authority (FINRA) is the body responsible for regulating NASDAQ.
In February 8, 1971, when NASDAQ begun trading in the stock exchange, it was the first ever electronic market. It functioned more as a bulletin board and did not link buyers and sellers. Brokers were not too happy with its inception since it eliminated some of their work hence almost putting them out of business.
NASDAQ was a step up from over-the-counter method of trading. Even as far as 1987, the NASDAQ system of trading was still referred to as OTC method in the media and various stock journals and guides. NASDAQ gained popularity as it went on increasing the trade volume and being the first exchange market to do online trading helped it to thrive in a very short period of time.
In as late as 1987 most trading was still done through the telephone. Demand become so high that stocks could no longer be traded via phone this led to the establishment of Small Order Execution Systems (SOES). This enabled dealers to be able to trade online by entering their transactions electronically. This became widely accepted since it saved time and was more convenient.
The first linkage across the continent was in 1992 when NASDAQ made a connection with the London Stock Exchange. This indeed was the dawn of a new era and investors were very pleased since this meant that they could be able to buy stocks outside the United States. Companies could be listed both in London and in the US and this further led to the growth of stock exchange market.
One of the NASDAQ milestones and accomplishments is that in November 8, 2007, it purchased Philadelphia Stock exchange which was started since 1790 and was the oldest stock exchange market in America. NASDAQ has continued to grow and competes with major stock exchange firms in the world.