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Revision as of 12:12, 1 July 2005
An exchange is simply a market in which securities, commodities, options, or futures are traded.
To be traded, every stock must list on an exchange, a central place where buyers and sellers meet. The two big U.S. exchanges are the esteemed NYSE and the fast-growing Nasdaq; companies listed on either of these exchanges must meet various minimum requirements and baseline rules concerning the "independence" of their boards. But these are by no means the only legitimate exchanges. Electronic communication networks (ECNs) are relatively new, but they are sure to grab a bigger slice of the transaction pie in the future.
There are auction based exchanges, which means specialists are physically present on the exchangesâ€™ trading floors. Each specialist "specializes" in a particular stock, buying and selling the stock in a verbal auction. These specialists are under competitive threat by electronic-only exchanges that claim to be more efficient (that is, execute faster trades and exhibit smaller bid-ask spreads) by eliminating human intermediaries.
Chicago Board of Trade (CBOT)
New York Futures Exchange (NYFE)
New York Stock Exchange (NYSE)
New York Merchantile Exchange (NYMEX)
New York Board of Trade (NYBOT)
London Stock Exchange (LSE)