Nyse & Nasdaq
Essay by maecryer • January 14, 2012 • Essay • 405 Words (2 Pages) • 1,388 Views
NYSE & NASDAQ
There are similarities and differences between the NYSE and NASDAQ. These are two of the largest trading companies recognized today. The Public Company Accounting and Investor Protection Act of 2002 will be discussed.
NYSE stands for New York Stock Exchange. NASDAQ stands for National Association of Securities dealers Automated Quotation. They are the two most known and recognized trading companies.
SIMILARITIES
1. They are both major stock exchanges
2. They make up the majority of equities in North America
3. They are both a public trade company
4. They are both registered with the SEC
DIFFERENCES
1. They are both registered with SEC but NYSE is registered as a exchange and NASDAQ is registered as a securities association.
2. NYSE trades with mainly corporations, blue-chip, large industry and NASDAQ basically does electronics, technology, and internet-based companies.
3. The NYSE is an auction market that used floor traders to make most of its trades and NASDAQ uses communication through thousands of computers.
4. NASDAQ is a dealer's market and NYSE is an auction market.
5. The requirements to be company listed are different.
Requirements by NYSE
a. Round-lot holder is 400 U.S.
b. Public Shares 1,100,000 outstanding
c. Market Value of Public Share $40 million
d. Stock price must have a $4 stock price at time of listing
e. Earning test such as aggregated pre-tax income for the last three years $10 million
Minimum in each of the 2 most recent years $2 million
Third year must not be in negative
Requirements by NASDAQ
a. Minimum of 1,250,000 public-traded shares
b. Companies must have also have at least 450 Round-lot shares
c. 1.1 million average trading volume over past 12 months
d. Must have aggregate pre-tax earnings in the prior three years of at least $11 million in the prior 2 years at least $2.2 million in prior three years and no negative
The Public Company Accounting and Investor Protection Act of 2002 was created after the Enron, WorldCom and several other corporate scandals. Apparently, the public have lost faith in the market world.
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