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Nasdaq, Inc.
NASDAQOMXlogo.png
Founded Feb. 27, 2008
Headquarters New York
Key People Robert Greifeld, CEO
Employees 3,300+ employees
Products Exchange offering products covering multiple asset classes
Twitter @Nasdaq
LinkedIn Profile
Facebook Page
Website www.nasdaq.com

Nasdaq, Inc., is a publicly traded company (NDAQ), which owns and operates 26 exchanges, three clearing houses and five central securities depositories. It also sells financial technology to exchanges and firms globally as well as data and investor services.

The company is best known for its Nasdaq Stock Market, its primary equity-trading market, which ranks as the second largest stock exchange by market capitalization, after the New York Stock Exchange. [1] [2] [3]

Beyond its network of equity and derivatives exchanges, Nasdaq also develops and provides the backbone technology for exchanges as well as banks, brokers and trading firms. It offers listing services to companies. And it offers a variety of data services, from realtime market information and anaytics to corporate governance and investor services solutions. As such, Nasdaq has four main divisions: "trade" which is all of the Nasdaq exchanges, "tech" or technology products and services for other exchanges, "list", or the listing services for companies, and data and information services which it calls the "intel" division. [4]

In its trade division, Nasdaq operates its own exchanges, clearinghouses and central depositories that provide trading, clearing and settlement and depository services on products such as: cash equities, futures and options, fixed income, debt commodities, structured products, ETFs and other asset classes.[5]

The company's securities exchanges include: Nasdaq, the OMX Nordic Exchange, including First North and the 144A PORTAL Market while futures markets include NFX and NLX. Nasdaq owns and operates six US equity options exchanges, which combined, handle 39.3 percent of US equity options volume, as of July 2016. It's six options exchange include three from the International Securities Exchange, acquired on June 30, 2016 along with the Nasdaq Options Markets (NOM), Nasdaq OMX BX and Nasdaq OMX PHLX. [6][7]

Nasdaq Markets - http://business.nasdaq.com/trade/markets/index.html


Nasdaq's tech division provides the backbone technology needed to build and operate an exchange, clearing house, depository and surveillance department for a stock or derivatives marketplace. Nasdaq supports the operations of more than 70 marketplaces in over 50 countries for exchanges, clearinghouses, depositories and regulators. It also provides surveillance and risk management technology to more than 75 brokers in over 80 countries, as well as buy side and sell side firms.

In terms of listing services on its own markets, it has more than 3,700 companies listed on its US, Nordic and Baltic exchanges which represents more than $9.3 trillion in overall market value. Smaller companies can list on its First North market in Europe. It also provides a private market called Nasdaq Private Market to help firms identify partners and support before they go public. [8]

Nasdaq's intel division offers more than 90 market data, global index and corporate solutions across 70 different countries for 2.5 million direct customers. It currently has about 41,000 Nasdaq global indexes. Corporate solutions provides distribution of market information for public and private companies' investor relations, public relations and governance departments.

The company was ranked as the eleventh-largest derivatives exchange in the world by contract volume in 2015, according to the annual Futures Industry Association's (FIA) survey.[9]

OMX Nordic Exchange is not a legal entity but describes the common offering from Nasdaq OMX Group exchanges in Helsinki, Copenhagen, Stockholm, Iceland, Tallinn, Riga, and Vilnius.

Nasdaq's own market capitalization is $--- billion, as of August 2016.


Background of the Combined Entity

EARLY DAYS FOR NASDAQ NASDAQ began when the National Association of Securities Dealers, or NASD, wanted to create a way for investors to buy and sell stocks on a computerized, transparent, and fast system. The NASDAQ Stock Market debuted in 1971 as the world’s first electronic stock market. Restricted shares of NASDAQ were initially sold by the NASD in 2000 through a private placement offering. Nasdaq separated from the National Association of Securities Dealers in 1987.

In 1991 it became the first exchange to sell its technology to power other exchanges, as well as the first to have an integrated derivatives trading and clearing system. It became the first to sell market technology to Asia and Hong Kong in 1995, and in 1996 it became the first exchange to launch a financial web site, www.nasdaq.com. [10]


LOOK FOR MORE INFO: http://business.nasdaq.com/discover/nasdaq-story/our-heritage

Trading restrictions expired in 2002 and shares began trading on the OTC Bulletin Board under the symbol NDAQ. On Feb. 9, 2005, NASDAQ listed its shares on The Nasdaq Stock Market following an offering of secondary shares priced at $9 per share.

Nasdaq was traditionally known as the home of technology and growth stocks, such as Dell, Cisco and Apple, but has expanded into a wide variety of sectors.[11]

  • Nasdaq made two failed attempts to acquire the London Stock Exchange, the second of which hostile bid was rejected by the LSE's shareholders in 2006, and LSE executives spurned further discussions with Nasdaq executives. The offer expired on February 10, 2007.[12]


NASDAQ ACQUIRES OMX: GOES MULTI-ASSET, GLOBAL

The current Nasdaq, Inc., (formerly NASDAQ OMX Group), was created when the Nasdaq Stock Market acquired the Nordic exchanges' OMX Nordic Exchange marketplace on Feb. 27, 2008.[13] The acquisition allowed Nasdaq to diversify and expand its global footprint. Nasdaq removed OMX from its branding almost seven years after the acquisition of the Nordic exchange group.

As part of the transaction, NASDAQ OMX Group also became a 33.33 percent shareholder in DIFX, Dubai's international financial exchange. Borse Dubai is a 19.9 percent shareholder of NASDAQ OMX Group.[14]

Before the merger with OMX, the Nasdaq Stock Market (NASDAQ) listed itself as the world's second-largest cash equities platform by trading volume and the biggest electronic screen-based equity securities market in the U.S. in terms of listings and traded share volume.[15]

Nasdaq launched a second equity exchange in Jan. 2009 after it acquired the Boston Stock Exchange in August of 2008 and renamed it NASDAQ OMX BX. [16]

The company continued to expand into other assets classes, moving into options in March of 2008 after receiving approval from the Securities and Exchange Commission to launch the NASDAQ Options Market, an equity and index options market.

Nasdaq then launched a futures exchange in January of 2009 after it acquired the Philadelphia Board of Trade (PBOT) in 2008 as part of its acquisition of the Philadelphia Stock Exchange. The renamed NASDAQ OMX Futures Exchange (NFX) lists futures products, including interest rate swap futures, currency futures and sector index futures.[17]

Its expansion into interest rate derivatives began with the launch of the platform NASDAQ OMX NLX in London on May 31, 2013. The platform started trading initially with six products including the German bund and Euribor, in direct competition with the two biggest exchanges in the region.[18]

Nasdaq gained further exposure to the fixed income markets on July 1, 2013, when it acquired the electronic Treasuries trading platform eSpeed from BGC Partners Inc. [19] [20] [21] The platform — which trades two-, three-, five-, seven-, ten- and 30-year instruments — became part of Nasdaq OMX's Transaction Services business.[22]



FURTHER EXPANSION/ACQUISITION

The NASDAQ OMX Group acquired Nord Pool ASA, the world's largest power derivatives exchange and one of Europe's largest carbon exchanges, in 2010, and it became part of NASDAQ OMX Commodities.

NASDAQ OMX Group and Intercontinental Exchange (ICE) attempted to acquire NYSE Euronext in 2011, but withdrew their bid after the U.S. Department of Justice threatened an antitrust lawsuit. [23] [24]

In 2013, NasdaqOMX Group acquired Thomson Reuters’ investor relations, public relations and Multimedia Solutions businesses.[25]


Facebook IPO Fallout

Facebook listed its IPO on Nasdaq on Friday, May 18, 2012, but trading in the stock was delayed and technical glitches led to confusion, incomplete orders and mispricing. [26] When trading began at 11 a.m. the Nasdaq system was overwhelmed by 496,000 orders that sent Nasdaq’s computers into a continuous loop that made it impossible to establish a correct opening price for Facebook stock.

In May of 2013 the SEC levied a $10 million fine against Nasdaq OMX regarding the problematic Facebook IPO . The SEC cited “poor systems and decision making” both before and after the Facebook initial public offering. In addition to the $10 million fine, Nasdaq had already agreed to pay $62 million to the brokers who lost money because of the problems.[27]

In April 2015, Nasdaq OMX agreed to pay $26.5 million to settle a class-action lawsuit over the Facebook IPO. The suit said Nasdaq broke the law in failing to disclose technology weaknesses in its IPO systems and failing to properly design and test them for the Facebook offering. It was the first time a court had sustained a class action suit against a stock exchange.[28]

As part of the fallout from the IPO, in January 2014 Nasdaq said it no longer wanted to run the securities information processor, or SIP, the marketwide quote service that broke down and froze thousands of its U.S. stocks on August 22, 2013. [29] However, Nasdaq later reconsidered and made a bid for the contract in 2014, becoming one of two finalists to run the SIP, the other being Tradeworx Inc.’s Thesys Technologies LLC. [30] In November 2014 Nasdaq beat out Thesys and won the right to keep running the SIP, with a mandate to create a subsidiary to manage it.[31]

Company Overview

The company has four main divisions: Market Services, Listing Services, Technology Solutions and Information Services.

The company's 26 exchanges include the Nasdaq Stock Market, Nasdaq Nordic exchanges, the Nasdaq Baltic Market, the Armenian Stock Exchange (or Nasdaq OMX Armenia), and Nasdaq Commodities, based in Oslo, Norway, which offers trading in power, natural gas and carbon emission markets, tanker and dry cargo freight, fuel oil, seafood derivatives, iron ore, electricity certificates and clearing services.