Yesterday it was reported that the Nasdaq Composite Index rose 10.18 points, or 0.5%, to 1926.38, its 11th straight rise, a streak not seen since September 1996. The Dow lost 34.68 points, or 0.4%, and the S&P 500 index lost 0.51 points, or 0.1%.

That all sounds good for NASDAQ, right? Except for one thing; what’s NASDAQ?

NASDAQ stands for National Association of Securities Dealers Automated Quotations. According to Wikipedia, it’s the most active stock exchange in the world, even more than the Dow. It’s a computerized data system to provide brokers with price quotations for securities traded over the counter, whatever that means. There are approximately 3,200 companies traded on the NASDAQ; many are technology and Internet related, although financial, consumer and industrial companies are represented as well.

Since that doesn’t totally help, it means we need to know what the New York Stock Exchange, or NYSE, is. It’s another stock exchange, of course, that lists 2,500 or so companies. However, instead of using a computerized system, per se, it uses the Dow Jones averages to determine the prices the stocks these companies have put out are worth.

There’s also the way each conducts business. The NYSE is considered as more face to face, even though some trading can be done by computer. NASDAQ is totally computerized and electronic, so there’s no overt negotiating, even though they were once part of a price fixing scheme conducted by a number of brokerage houses (I’m sure they just paid up the settlement without admitting guilt; that’s how they roll).

Overall, then, both of these exchanges are pretty much the same, along with S&P (Standard & Poor) only they represent different businesses. Most companies that dole out stocks will be on one or the other, and right now, NASDAQ seems to be more stable. I guess Touche Turtle was right when he said “You can’t tell the two-headed dragon from the turtle without a program.”

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