A stock exchange currently managing more than 90 markets with about 1.8 billion completed online transactions each is truly shaking up the trading community, which is NASDAQ. So What is Nasdaq? Let’s join Learn Forex Trading to learn more about the decentralized NASDAQ stock exchange with the 3rd highest market capitalization globally through the article below!
Find out What is Nasdaq.
Answer What is Nasdaq? NASDAQ is the abbreviation for an American stock exchange – National Association of Securities Dealers Automated Quotation System. This is the second-largest stock exchange in the world for investors who want to buy and sell stocks. Began its market launch on February 8, 1971, as a stock price listing system. However, today NASDAQ has become an extremely reputable and quality stock exchange.
Not only that, NASDAQ continues to upgrade to become the first stock exchange to use applications and commercialize cloud computing technology to store data. Some impressive achievements of NASDAQ include more than 3,400 listed companies, managing more than 90 markets, capitalization of up to 15.43 billion USD, and more than 10,000 customers…
See more: Forex – Great way to become a financial “billionaire”.
Impressive milestones of NASDAQ
The development process and prominent stages of What is Nasdaq? Learn Forex Trading During its operation, NASDAQ promptly left an impression on the trading community by establishing memorable development milestones, including:
- 1971: NASDAQ was established based on the principle of over-the-counter trading by the National Association of Securities Dealers.
- 1995: NASDAQ closes at 1,000 points.
- 2005: The record number at the time of closure reached 5132.52 points.
- 2019: Becoming the largest stock exchange in the US.
What are NASDAQ’s operating hours?
NASDAQ is open on weekdays Monday through Friday (ET) from 9:30 a.m. to 4:00 p.m. Including 3 main trading sessions:
- Standard NASDAQ trading runs from 9:30 a.m. to 4:00 p.m. ET.
- Pre-market NASDAQ trading from 4:00 to 9:30 ET.
- NASDAQ after-hours trading from 4:00 p.m. to 8:00 p.m. ET.
In addition, NASDAQ also offers the opportunity to participate in special trading sessions for traders from 18:00 on Sunday.
What is the Nasdaq index calculation method and how to play NASDAQ
On the NASDAQ stock exchange, there are currently two important indexes that play a special role for traders: the NASDAQ 100 index and the NASDAQ Composite index. So do you know how to calculate the What Is Nasdaq index? And how to play NASDAQ effectively or not?
NASDAQ Composite Index
The NASDAQ Composite is an index that measures the changes of more than 3,000 currently traded stocks. In the stock market, there will be 7 categories included in the index:
- ADR – American Certificate of Trust
- Share of common stock
- Ordinary shares
- Capital contribution interest rates of limited liability companies
- REUTS – Real Estate Investment Trust Certificate
- Tracking Stocks
- Shares are in close interest of SBI owners
To calculate the NASDAQ Composite index, traders can apply the following formula:
| NASDAQ Composite Index = (The closing price of security x Weight of each security) / Divisor |
NASDAQ 100 Index
The NASDAQ 100 index is often used to measure the value of the 100 largest financial companies listed on the stock market, for example: Apple, Microsoft, Facebook… Most companies operate in the field of technology, and finance. Therefore, the NASDAQ index is also understood as a representative statistic for the global industry.
The formula used to calculate the NASDAQ 100 index:
| NASDAQ 100 Index Value = (The closing price of security x Weight of each security) / Divisor |
Why is NASDAQ favored by global traders?
The NASDAQ index is currently one of the most popular factors on the stock exchange. To know why, you need to know the What is Nasdaq index, which includes both the NASDAQ 100 and the NASDAQ Composite. Here are 3 reasons why NASDAQ is so popular
:
A high percentage of NASDAQ 100 stocks are in the technology sector
The first highlight that helps NASDAQ attract traders is stocks. The NASDAQ 100 index includes the top 100 non-financial companies that own 47.25% of stocks in the extremely high-tech sector. Traders often call this the US technology stock benchmark. The remaining shares will be in consumer goods, health care, and services.
The NASDAQ index is getting higher and higher
However, recently the world has been severely affected by the COVID-19 pandemic. That has caused the economy to decline and the trading exchange is no longer active. However, the NASDAQ index has always remained stable, even skyrocketing 60% since January 2020. It can be said that the pandemic has accelerated the digitalization process, increasing the demand for e-commerce and services. online… growing strongly. Therefore, NASDAQ has grown, growing more and more.
Supports balancing indexes with stocks
Besides, the NASDAQ 100 also allows traders to limit the influence of leading companies. At the same time, it helps balance the index with the entire stock warehouse. Because NASDAQ is market capitalization-weighted, no company can account for more than 24%. Furthermore, NASDAQ volatility is also an important factor that directly affects the USD, as well as other currency classes and financial assets.
See more: Opening and verifying an ICMarkets account
Conditions for businesses to list shares on What is Nasdaq?
NASDAQ is an extremely reputable and quality stock exchange. Therefore, to be listed on the exchange, investors must meet at least the following 3 conditions:
- The company’s pre-tax income in any of the last 3 years or 1 or 2 years must reach over 1 million USD. Of which, the total value of shareholder capital is at least 15 million USD.
- The equity of a listed enterprise must be at least 30 million USD higher than the shareholder’s capital.
- Total market value reaches at least 75 million USD.
If a smaller company wants to list, it can choose NASDAQ Cap Markets. In case the above 3 criteria are not met, the business must prove that its collections or assets in the most recent 1, 2, or 3 years are over 75 million USD. When a business is listed, the minimum share price must be at least 4 USD and the minimum total value is 1.1 million USD.
summary
Above is all the information related to the question What is Nasdaq? Hopefully, what Learn Forex Trading has given will help readers better understand NASDAQ. Through that, helping investors have the best trading results on the NASDAQ stock exchange. If you want to find more related knowledge, for example: What is Fibonacci? Or what is CFD ?… Please follow the website to receive the latest updates from us.
FAQs:
What is Nasdaq and how does it work?
NASDAQ is a stock exchange that stands for Nation Association of Securities Dealer Automated Quotations. This is the 2nd largest electronic stock exchange in the United States, established in 1971. NASDAQ operates using modern computer systems to provide information on prices, finances, and stock transactions one by one. The most accurate way for traders.
What companies are listed on NASDAQ?
Currently, the listed list includes major technology companies in the world such as Apple, Microsoft, Alphabet, Amazon, and Facebook… There are also many companies in the financial and healthcare industries…
What is the difference between other stock exchanges and What is Nasdaq?
NASDAQ is one of the three largest stock exchanges in the world. Therefore, it has many differences compared to other stock exchanges such as trading methods, listing rules, and how to play NASDAQ…
