Tips On Trading In NASDAQ



The NASDAQ though we know it as an exchange is not an exchange, and works like an automated mechanism where buyers and sellers can meet. The NYSE works on the system called double auctions where in the highest bidding buyer competes with other buyers and the lowest bidding seller bids against other sellers.NASDAQ though not very old has give tough competition to NYSE.The technology focus has helped NASDAQ some inherent strengths. Now for NASDAQ the auction method does not work, it is like a series of dealers which are selling stocks and each dealer has some sort of inventory of stocks as well as cash. Now NASDAQ is completely automated so going by above analogy you do not visit each dealer shop instead the computer system visits the store of each dealer and checks what prices and how much shares does each dealer have to satisfy an order. As an example I will show how a limit order works and how a market order works. Limit means that you impose a limit on the price you are willing to pay for the stock. In the market order you are willing to pay any price which is currently in the market. For example if you need to buy 1000 shares then the dealer will give 500 shares at a price you quoted but the next 500 shares you will get at a price which can be anything based on the price the dealer procures the additional shares for you. NASDAQ as you can see is the interdealer market represented by securities dealers and these dealers are called market makers. These dealers then compete with each other to post their best prices (both bid and ask). A normal non professional person can have access to this bid offers, ask size, size of each offer and they are called level II quotes. The system that provide the quotes is called Small Order Execution System. In conclusion, NASDAQ seems to favor the small investor like you and me for trading and that is all that matters in the stock trading arena.However there are other exchnages which can help really really small investor with special deals and cash only options like the American Exchange.andnbsp; If you need to trade in penny stocks then what you need is trading in OTCBB. But be careful as penny stock trading is very risky and volatile. If you absolutely abhor the idea of learning how the stock market works or for that matter you do not want to gain an understanding of the how the stock market works the your best bet is to take the advice of a broker who is employed at a full service brokerage firm.






About Author:

beginners guide stock market is important for knowledge of how does the stock market work





All Best Articles at http://www.allbestarticles.com
You Can Link Directly to "Tips On Trading In NASDAQ"
by using the url: http://www.allbestarticles.com//finance/trading/tips-on-trading-in-nasdaq.html


Add Your Picture
Add Your Picture


Article Submitted By: JohnBorder
This Article Has Been Read 214 Times











Publish/Share this article

Remember: The article body, title, author bio and links may not be changed or removed. By publishing this article, you agree to all the terms in our Terms of Service.
Get the HTML for reprinting the article to your site


Rating: Not yet rated




Related information on Trading

Online Trading Can Help You To Make Money

Now It is possible to Profit From Futures Working with Swing Investing

Online Proprietary Daytrading Firms: Purchasing Prop Trading To Generate Money

Gaining Amazing Profit with the Intraday Trading

Defining a CFD Financing Contract

How The Influences Of Cycles Can Offer Opportunities Beyond The Limitations Of Commodity Trading?

Understanding Binary Options Trading

Starting Point on Proprietary Day Trading Stocks

CFD trading mechanism

Choose the Best CFD and Trade the Way You Want to

Why Individuals Make The Decision To Pursue The Opportunities That Exist With Commodity Trading

Getting an adequate education before doing work for a proprietary trading firm

Five Things You Need For Profitable Trading

Understanding What CFD Trading Is All About

Doing well With The Ideal Proprietary Trading Firms