The NASDAQ, or National Association of Securities Dealers Automated Quotation, appeared in 1971 and changed the US stock market. It appeared to be the first totally electronic trading platform and began to give automatic stock quotes. With the help of the Capital you can easily follow NASDAQ today chart and here we are going to share some data on its history and special features.
History and stages of development
Prior to 1968, trading was riskier for investors because companies did not file financial statements regularly.
In 1968, an automatic trading accounting program appeared. She was commissioned to develop the US Securities and Exchange Commission. The program regulated over-the-counter trading and automated the market. It got the long name that today is common as the abbreviation NASDAQ and provided information about stock quotes, but did not allow them to be traded.
The following stages were:
- On February 8, 1971, the first transaction was made on it. Instead of the usual platform, investors had access to an electronic board where all the needed data were located. They could see the price range, so volatility was low and there was little room for speculative trading. Because of this, many traders switched to other options.
- Since 1980, the NASDAQ has become a full-fledged exchange. A technology has appeared that automatically places and executes orders. After that, investors did not need to carry out these operations by phone and waste extra time. They quickly learned all the information about the shares and freely traded them.
- In 2007, it entered the European stock market. The exchange acquired the Swedish corporation OMX, which united several Scandinavian stock markets. The deal amounted to 3.7 billion dollars. In 2008, it completely absorbed OMX.
Nowadays it is a fully electronic trading platform. The stock exchange has never had a trading floor. Small companies do IPOs on it because the exchange attracts startups and is cheaper to list than the NYSE.
What are its special features?
The main facts that one should remember are:
- The first trade was done in 1971. Since 1980, transactions with securities have become automated.
- Unlike other trading venues that are also well-known, the NASDAQ has never had a place. Since 1971, all transactions have been carried out electronically. All transactions take place online, and stock quotes are updated every second.
- Listing here is considered one of the cheapest in the US. Therefore, small companies conduct IPOs on the stock exchange. To enter this market, you need to deposit $55,000 and pay from $45,000 per year. The NYSE listing fee costs a minimum of $150,000.
- Since 1975, the exchange has opened access for small companies. During this period, the IT sector was developing, so many startups entered this platform and find it useful for their development. Among them were Apple, Microsoft, Intel, and Cisco.
To understand the information technology market and analyze technology stocks, investors follow the NASDAQ. This is a fully electronic marketplace. The largest IT companies are listed here and many startups are conducting IPOs.