Overview
The NASDAQ Stock Market (National Association of Securities Dealers Automated Quotations) is the world's first electronic stock exchange, founded in 1971. It is the second-largest stock exchange globally by market capitalization of listed companies, trailing only the New York Stock Exchange. NASDAQ operates as a self-regulatory organization (SRO) registered with the Securities and Exchange Commission (SEC) under the Securities Exchange Act of 1934.
NASDAQ is owned by Nasdaq, Inc., a publicly traded financial services and technology company that also operates multiple other exchanges, including the Nasdaq Nordic and Baltic exchanges, and provides market technology to over 130 market infrastructure operators worldwide. The exchange is particularly known for its concentration of technology, biotechnology, and growth-oriented companies, hosting listings for firms such as Apple, Microsoft, Amazon, and Alphabet.
As an SRO, NASDAQ is responsible for writing and enforcing rules governing the trading of securities on its platform and the conduct of its member firms. It maintains listing standards, conducts market surveillance, and enforces compliance among its members. NASDAQ operates a fully electronic trading system with no physical trading floor, processing billions of shares daily through its matching engine technology.
Basic Identity
Field | Value |
|---|---|
Official Name (English) | The Nasdaq Stock Market LLC |
Acronym | NASDAQ |
Country | United States |
Jurisdiction Level | Federal |
Official Website | |
Headquarters | New York, New York, United States |
Year Established | 1971 |
Current Status | Active |
Classification
Field | Value |
|---|---|
Entity Type | Self-Regulatory Organization |
Control Layer | Layer 2 โ Delegated Regulator |
Legal Authority Level | Self-Regulatory |
What This Entity Oversees
Domain | Specific Oversight |
|---|---|
Electronic Securities Trading | Operation of fully electronic equities market for stocks, ETFs, and options |
Listing Standards | Financial, governance, and disclosure requirements for NASDAQ-listed companies across three tiers (Global Select, Global, Capital) |
Member Regulation | Rules governing broker-dealer firms that are NASDAQ members |
Market Surveillance | Automated monitoring systems to detect manipulation, spoofing, layering, and other abusive trading practices |
Corporate Governance | Listing rules requiring board diversity, independent directors, and compensation committee standards |
Market Data | Production and sale of official NASDAQ market data, indices, and analytics |
Regulatory Powers
Power | Scope & Exercise |
|---|---|
Rulemaking | Proposes and enforces trading rules and listing standards, subject to SEC review and approval |
Disciplinary Actions | Can fine, censure, suspend, or bar member firms and associated persons |
Market Surveillance | Operates the NASDAQ Market Watch system for real-time detection of suspicious trading activity |
Listing/Delisting | Authority to approve listings, deny applications, and delist non-compliant companies (with appeal process) |
Trading Halts | Can implement trading halts for individual securities (news-based, regulatory) and participate in marketwide circuit breakers |
Referrals | Refers potential federal securities law violations to the SEC for enforcement |
Legal Foundation
Element | Details |
|---|---|
Primary Statute | Securities Exchange Act of 1934 (15 U.S.C. ยง 78a et seq.) |
Key Amendments | Securities Acts Amendments of 1975; Regulation NMS (2005); Regulation ATS (1998) |
Payments and Money Movement Relevance
NASDAQ-traded securities generate substantial daily payment flows through the U.S. clearing and settlement infrastructure. Every transaction on NASDAQ results in settlement obligations processed by the DTCC/NSCC, with funds movement occurring through DTC participant accounts and ultimately through Fedwire. The shift to T+1 settlement (effective May 2024) has increased the velocity of payment flows associated with NASDAQ trading.
Nasdaq, Inc. also operates market technology platforms that power exchanges and clearing houses worldwide, making it a critical technology provider to global payments and settlement infrastructure. NASDAQ's indices, particularly the NASDAQ Composite and NASDAQ-100, are the basis for trillions of dollars in index fund and ETF assets, generating ongoing creation/redemption payment flows. Additionally, NASDAQ's listing of major payment companies (Visa, PayPal, and numerous fintech firms) makes its market data and trading activity directly relevant to the payments industry.
Relationship to Other Regulators
Regulator | Relationship |
|---|---|
Securities and Exchange Commission (SEC) | Primary federal oversight authority; approves NASDAQ rule changes and conducts inspections |
FINRA | Fellow SRO; NASDAQ delegated certain member regulation functions to FINRA under a Regulatory Services Agreement |
DTCC/NSCC | Provides clearing and settlement for NASDAQ-traded securities |
Options Clearing Corporation (OCC) | Clears options traded on NASDAQ options markets |
Commodity Futures Trading Commission (CFTC) | Regulates futures products associated with NASDAQ indices |
Key Public Resources
Resource | Details |
|---|---|
Website | |
Contact Page | |
Headquarters Address | 151 West 42nd Street, New York, NY 10036, United States |