Secondary Markets Flashcards
_____________ are the markets in which stocks, once issued, are traded among investors
Secondary stock markets
_______ was the first truly global stock market
NYSE
The ______ is where trading occurs at a specific place on the floor of the exchange called a trading post
NYSE
Each stock has a special market maker called a _________ that maintains liquidity for the stock at all times
specialist
What are the three types of transactions occur at trading posts?
Limit order, market order, and specialist transacting for their own account
_________ is the simultaneous buying and selling of a portfolio of at least 15 different stocks valued at more than $1 million using computer programs to initiate the trades
Program trading
What is the biggest stock market in the US?
NYSE
__________ give investors time to make informed choices during periods of high market volatility
Circuit breakers
What are the NYSE stringent listing requirements for firms?
Minimum # shares outstanding (liquidity)
Minimum CF, earnings, & revenue
Minimum share price = $1
Minimum market capitalization of firm $40M
The _____ has about 3,200 firms listed
NYSE
The ______ accounts for 80% of total U.S. organized exchange volume
NYSE
________ is the world’s first electronic market and has no physical trading floor
NASDAQ
________ provides continuous trading for the most active stocks traded over the counter (OTC)
NASDAQ
A _____________ provides automatic order execution for orders of less than or equal to 1,000 shares
small order execution system (SOES)
The NASD maintains an electronic _________ and “pink sheets” for small firms that are not part of the NASDAQ
“OTC bulletin board”
In ________, traders are allowed to see incoming buy or sell orders milliseconds earlier than general market traders
Flash trading
________ then use computerized statistical analysis to generate high frequency trading strategies that are executed by computer as well
Flash traders
What is a pro of flash trading?
Flash trading creates more liquidity and the possibility of price improvement
What is a con of flash trading?
Creates a disadvantage for regular traders and investors who are not allowed to view incoming orders and high volume of trading generated by multiple computers can lead to events like the so called flash crash
On May 6, 2010, the financial markets experienced the ________
“flash crash”
__________ occurs when brokers and exchanges allow some traders to engage in high frequency trades anonymously using the broker’s access code
Naked access
__________ are trades that occur on alternative trading platforms (such as electronic communication networks) that do not report the details of the trade on order books
Dark Pools
