3: Institutions (2nd Market)

Question 1

Generally describe the major types of exchanges in the Secondary Market.

Answer 1

1. The New York Stock Exchange
2. regional exchanges
3. The OTC market
4. NASDAQ

Question 2

Which exchange has the highest listing standards?

Answer 2

New York Stock Exchange

Question 3

The ______ is a national exchange in that it lists companies from all parts of the country and some from foreign countries

Answer 3

New York Stock Exchange

Question 4

What is a regional exchange?

Answer 4

Specializes in companies primarily in that region where it operates

Question 5

Explain dual listing.

Answer 5

trading stocks on multiple exchanges–national and regional

Question 6

What is the largest regional exchange?

Answer 6

Chicago Stock Exchange

Question 7

What is the OTC market?

Answer 7

consists of any trading done directly via a dealer network (example: NASDAQ)

Question 8

The OTC market remains the primary market for what types of investing instruments?

Answer 8

• Bond trading
• Commercial paper
• Large CD’s
• Municipal bonds
• Other money market instruments

Question 9

Describe the third market.

Answer 9

OTC, high-volume, off-exchange trading of exchange-listed stocks

Question 10

Describe the fourth market.

Answer 10

an informal arrangement for direct trading between institutions (not individuals)

Question 11

What is an ECN?

Answer 11

Electronic communications networks – provide institutional trading with no commission charges. Primarily trade stock and currencies.