Question

In your own words, identify two different stock exchanges in the United States. Describe the similarities and differences between the two stock exchanges. Identify one stock from each of the two stock exchanges.

Answer 1

A)NASDAQ and the New York Stock Exchange (NYSE) are two stock exchange market which accounts for most of the trading in North America and global business.

B) Similarities.

We can find only few similarities between NASDAQ and NYSE

1. Both are public entities in US accounting major portion of equities and fixed income traded in U.S.

2. Work time=weekdays from 9:30m to 4:00 pm ET

3.  The two stock exchange centres concentrate on trading stock options, cash equities, fixed incomes and also exchange-traded goods.

4. Measures taken to troubleshoot problems-Both market utilizes traffic controllers, On the NASDAQ, the traffic controller is known as the market maker which transacts with buyers and sellers to keep the flow of trading going. On the NYSE, the exchange traffic controller is known as the specialist, who is in charge of matching up buyers and sellers.

5. Both NASDAQ and NYSE trade on themselves when they are not able to find buyers or sellers, which has to be done as per regulation given by securities and exchange commission.

DIssimilarities

	NASDAQ	NYSE
Founded	1971	1792
Location	New York City, NY and Mawah, NJ	New York City, NY
Volatility	Stocks often more volatile	Stocks often less volatile
Traffic Control*	Market maker	Specialist
Market Type	Dealers Market	Auction Market

*Both uses traffic controllers but different in procedures and nature

Market Type

Dealers Market-Type of a market where multiple dealers post prices at which they will buy or sell a specific stock.In a dealer’s market, a dealer is designated as a market maker – a member firm or market participant such as a brokerage company or bank – that actively buys and sells stocks on behalf of traders. Market makers can enable the process of matching up buyers and sellers to be a lot quicker, maintaining liquidity and ensuring an efficient trading process.

Auction Market-system based on buyers and sellers entering competitive bids at the same time. The price at which a stock is traded reflects the highest price that a buyer is willing to pay, and the lowest price a seller is willing to accept. Matching bids and offers are then paired together with the orders executed by the ‘specialist’(Traffic control)

Location of transaction

NYSE have a physical trading floor although more transactions are occurring through the data center in mawah,Nj but NASDAQ doesn't have a physical trading floor and transactions occuring through a computer bulletin board system.

Companies Listed

NYSE-Around 2800 companies.

NASDAQ-More than 3300 companies.

The nASDAQ 100 features 100 of the largest publicly-traded businesses, based on market capitalization, but Nasdaq’s wider exchange features many small and micro-capitalization stocks also.

Traffic Control

On the NASDAQ, the traffic controller is known as the market maker which transacts with buyers and sellers to keep the flow of trading going. On the NYSE, the exchange traffic controller is known as the specialist, who is in charge of matching up buyers and sellers.

C) SHARES TRADING ON NASDAQ & NYSE

NASDAQ	NYSE
Apple Inc. Common Stock	Pfizer
Microsoft Corporation Common Stock	Bank of America
Amazon.com, Inc. Common Stock	Delta Air Lines
Facebook, Inc. Class A Common Stock	United States Steel
Tencent Holdings Ltd. ADR	Citigroup

Thank You.