Glossary term
Nasdaq
Nasdaq is a U.S. national securities exchange known for electronic trading and many technology and growth-company listings.
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What Is Nasdaq?
Nasdaq is a U.S. national securities exchange known for electronic trading and many technology and growth-company listings. Public companies can list their shares on the Nasdaq Stock Market if they meet applicable listing standards.
The word Nasdaq can also cause confusion because people use it to refer to the exchange, Nasdaq Inc. as a company, or indexes such as the Nasdaq Composite. Those are related, but they are not the same thing.
Key Takeaways
- Nasdaq is a national securities exchange registered with the SEC.
- It is an electronic marketplace where listed securities can trade.
- Many technology and growth companies list on Nasdaq, but it is not only a technology exchange.
- The Nasdaq exchange is different from the Nasdaq Composite Index.
- A stock's listing exchange does not by itself determine whether the stock is a good investment.
How Nasdaq Works
Nasdaq provides a regulated marketplace where buyers and sellers can trade listed securities. Like other U.S. national securities exchanges, it operates under securities laws, listing rules, trading rules, and regulatory oversight.
Companies listed on Nasdaq must meet listing requirements. Those requirements can include standards related to share price, market value, public float, shareholders, governance, and financial condition.
Nasdaq Exchange Versus Nasdaq Index
Term | What it means |
|---|---|
Nasdaq Stock Market | The exchange where securities are listed and traded |
Nasdaq Composite | An index tracking many Nasdaq-listed stocks |
Nasdaq-100 | An index of 100 large non-financial Nasdaq-listed companies |
Nasdaq Inc. | The company that operates exchanges and market services |
Why Nasdaq Matters
Nasdaq is one of the most visible parts of U.S. equity markets. Its listings and indexes are often used as shorthand for growth stocks, technology leadership, and market sentiment.
Investors should be precise. Saying “the Nasdaq is up” may refer to an index. Saying a company “lists on Nasdaq” refers to the exchange. The investment question still comes back to the company's fundamentals, valuation, risk, and portfolio fit.
The Bottom Line
Nasdaq is a major U.S. securities exchange and a familiar name in stock-market indexes. It helps connect companies and investors, but a Nasdaq listing is only the beginning of research, not an investment thesis.