What is the NASDAQ Exchange?



The NASDAQ Exchange is a limited liability company and a corporation that provides a means for traders to execute stock orders for stock brokers, institutional investors and on-line stock purchasers. The NASDAQ Exchange was formed in 1971 by the National Association of Securities Dealer to fill a need for reporting stocks that were not a good fit in the regular stock exchange. The NASDAQ reports on over the counter stocks for thousands of stocks not listed on the other exchanges. By the 1990s NASDAQ surpassed in terms of listings the AMEX Exchange.

In order to trade on the NASDAQ the trader and members must be certified and agree to the by laws of NASDAQ Inc. In 1999 NASDAQ merged with AMEX to form the NASDAQ-Amex Group. By 2000 the National Association of Securities Dealers sold their interest in NASDAQ to private investors. See: NASDAQ Corporate Filings.

NASDAQ operates similarly to all corporations, it has Articles of Incorporation, Corporate Officers, By Laws and holds meetings. The NASDAQ LLC. has a governing board and in turn has rules and regulations it operates under. Given the quasi-governmental status of NASDAQ the Securities and Exchange Commission has a role in making sure NASDAQ operates according to good practices and regulations. If a company engages in inside trading, fraudulent reporting of corporate earnings and assets or the many areas of bad practices governed by the Securities Act of 1934, the Commission can provide sanctions and remedies for these acts. Likewise, state attorney generals and the U.S. Attorney may bring actions in court to cease and desist these bad acts and also provide for criminal sanctions.


What notable stocks are traded on NASDAQ?

As an investor you may invest in NASDAQ, it is listed under the ticker QQQQ. The stock value goes up and down depending on the overall health of the NASDAQ Top 100 Trust Funds. Currently NASDAQ QQQ, traded under ticker QQQQ is priced at around $48 a share. It has a market capitalization of $19 billion dollars and over the past three years has a 11.56 percent return on investments. The top holdings in QQQQ are: Apple, Cisco, Comcast, Gilead Sciences, Google, Intel, Microsoft, Oracle, Qualcomm, and Research in Motion. A impressive group to be associated with in one stock. There are however, some stocks among the fund that are not as illustrious in their performance. The fund is weighted heavily in the hardware sector. The others sectors with a significant impact are software, business services, customer service and healthcare.

NASDAQ provides soup to nuts in investment opportunities:

NASDAQ offers literally thousands of opportunities to invest in individuals stocks, indexes, real estate investment trusts, options and other means to make an investment. The investor has an cornucopia of types of stocks choose among from semiconductors, energy, finance, components, retail, in all 3113 components make up NASDAQ. Each company listed must meet capitalization and reporting standards. The investor has the opportunity to review each quarters reported earnings and debts. A company is required to report any significant issues that may effect the investor and the company. There are news services and financial advisor services who actively stay in top of company news. All in all it is surprising why a company would even try to fool investors or governmental watch dogs.

NASDAQ notables:

Apple Inc. is the darling of NASDAQ. It trades under the stock ticker AAPL. If you have been living on a remote island somewhere in a cave, Apple is the designer, manufacturer and marketer of iMAC computers, software, iphones and through its subsidiaries a range of products that support Apple main line of products. In September, 2005 Apple shares were in the vicinity of $48. As of the close of business on August 31, Apple is worth in the range of $138 a share. The unique aspect of Apple is just when you think it has topped out and is dawdling it comes up with some surprise and it is off and running again. It is a darling because it has resilience and innovation.

Never to be forgotten is Miscrosoft. It trades under the stock ticker MSFT. What can you say about a company that brought information and technology to middle America, Africa, South America and the world. It is a stock that sells currently in the $28 range. It has controversy in all corners particularly with law suits challenging this grand daddy of the Internet, but it is a tried and true long performer. It is the company that people love and hate. If there is innovation out there, Microsoft will find it.

A personal favorite of mine is Intel. In part because it is a work horse in the technology sector and in part because I read and enjoyed Tom Wolfe's book on the company structure in Hooking Up. It was not a biography, but it did parallel the formation of this egalitarian work place. The stock sells in the range of $25 and sells under the ticker INTC.




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