U.S. Stock Exchanges in the U.S.
Stock exchanges are marketplaces in which U.S. financial securities, commodities, derivatives and other financial instruments are traded. While in the past, traders and brokers used to meet physically in a stock exchange building to trade stocks, now most of the financial trading happens electronically and automatically. Still, each exchange has its own unique listing requirements for companies that wish to join. As a baseline, stock exchanges require regular financial reports, audited earnings, and minimal capital requirements.
Companies that operate publicly through shareholders, or successful startups wishing to put up an initial public offering (IPO) must go through a stock exchange. By being listed, companies must quickly adjust their pace of operations: they become closely-watched and scrutinized entities, as all their financials are open for potential investors to analyze. That being said, companies also benefit from increased visibility, and “going public” by getting listed on a stock exchange also increases a company’s visibility, including attracting new clients, employees, and other partners who view the company’s listing as a sign of success.
Major Stock Exchanges in the U.S.
The two major U.S. financial securities markets are the New York Stock Exchange and Nasdaq.
New York Stock Exchange (NYSE)
The NYSE is a stock exchange based in New York, founded in 1790. In April 2007, the New York Stock Exchange merged with a European stock exchange known as Euronext to form what is currently NYSE Euronext. NYSE Euronext also owns NYSE Arca (formerly the Pacific Exchange). In order to be listed on the New York Stock Exchange, a company must have 400 shareholders and 1.1 million shares outstanding. Locals and visitors can also see the exchange’s building on Wall Street in New York City–although more than 80% of trading is now done electronically.
The American Stock Exchange (AMEX) was also a popular New York-based stock exchange, which was acquired in 2008. Unlike the Nasdaq and NYSE, AMEX focused on exchange-traded funds (ETFs).
National Association of Securities Dealers Automated Quotation System (Nasdaq)
Unlike AMEX, the Nasdaq is the largest electronic screen-based market. Created by the National Association of Securities Dealers (NASD) in 1971, it is popular because of its computerized system and relatively modern, as compared to the New York Stock Exchange. It currently offers lower listing fees than NYSE and includes some of the largest companies, such as technology giants Apple, Google, Amazon, and Microsoft.
Additional Exchanges in the United States
Some other smaller exchanges exist based on the city they are located in.
- Boston Stock Exchange (BSE) – made up of the Boston Equities Exchange (BEX) and the Boston Options Exchange (BOX) and was acquired by Nasdaq in 2007
- Cboe Options Exchange (Cboe)
- Chicago Board of Trade (CBOT) - owned run by CME Group Inc.
- Chicago Mercantile Exchange (CME) - owned and controlled by CME Group Inc.
- Chicago Stock Exchange (CHX)
- International Securities Exchange (ISE) – includes ISE Options Exchange and the ISE Stock Exchange
- Miami Stock Exchange (MS4X)
- National Stock Exchange (NSX)
- Philadelphia Stock Exchange (PHLX)