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42-503: NEX Group plc , formerly known as ICAP plc , is a UK-based business focused on electronic financial markets and post trade business for other financial institutions rather than private individuals. They are known as an inter-broker dealer. The company operates BrokerTec and EBS , respectively among the largest treasuries and foreign exchange markets in the world. NEX was listed on the London Stock Exchange until it

84-426: A normal distribution , but are rather modeled better by Lévy stable distributions . The scale of change, or volatility, depends on the length of the time unit to a power a bit more than 1/2. Large changes up or down are more likely than what one would calculate using a normal distribution with an estimated standard deviation . Simply put, primary market is the market where the newly started company issued shares to

126-561: A broad impact on market participants' operating models and strategies. Seemingly, the most obvious buyers and sellers of currency are importers and exporters of goods. While this may have been true in the distant past, when international trade created the demand for currency markets, importers and exporters now represent only 1/32 of foreign exchange dealing, according to the Bank for International Settlements . The picture of foreign currency transactions today shows: Much effort has gone into

168-649: A financial market is a stock exchange . A company can raise money by selling shares to investors and its existing shares can be bought or sold. The following table illustrates where financial markets fit in the relationship between lenders and borrowers: The lender temporarily gives money to somebody else, on the condition of getting back the principal amount together with some interest or profit or charge. Many individuals are not aware that they are lenders, but almost everybody does lend money in many ways. A person lends money when he or she: Companies tend to be lenders of capital. When companies have surplus cash that

210-572: A group of borrowers. They can also take an organizational form like Mutual Funds. They can provide mortgage on weight basis. The main advantage is that this lowers the cost of their borrowings. During the 1980s and 1990s, a major growth sector in financial markets was the trade in so called derivatives . In the financial markets, stock prices, share prices, bond prices, currency rates, interest rates and dividends go up and down, creating risk . Derivative products are financial products that are used to control risk or paradoxically exploit risk. It

252-403: Is a crucial aspect of securities that are traded in secondary markets. Liquidity refers to the ease with which a security can be sold without a loss of value. Securities with an active secondary market mean that there are many buyers and sellers at a given point in time. Investors benefit from liquid securities because they can sell their assets whenever they want; an illiquid security may force

294-418: Is also called financial economics. Derivative products or instruments help the issuers to gain an unusual profit from issuing the instruments. For using the help of these products a contract has to be made. Derivative contracts are mainly four types: Over the past few decades, the derivatives market has increased and become essential to the financial industry. As the market expands, establishing and improving

336-649: Is made up of both American and foreign firms, with China and Israel being the largest foreign sources. "Nasdaq" was initially an acronym for the National Association of Securities Dealers Automated Quotations. It was founded in 1971 by the National Association of Securities Dealers (NASD), now known as the Financial Industry Regulatory Authority . On February 8, 1971, the Nasdaq stock market began operations as

378-448: Is not needed for a short period of time, they may seek to make money from their cash surplus by lending it via short term markets called money markets . Alternatively, such companies may decide to return the cash surplus to their shareholders (e.g. via a share repurchase or dividend payment). Banks can be lenders themselves as they are able to create new debt money in the form of deposits. Governments borrow by issuing bonds . In

420-635: The London Interbank Offered Rate (LIBOR). The United States Department of Justice charged three former employees, and ICAP paid $ 65 million to the U.S.'s Commodity Futures Trading Commission and £14 million ($ 22 million) to Britain's Financial Conduct Authority . In October 2014, ICAP's in-house legal team was awarded the Legal 500 2014 UK In-House Team Winner in the Litigation category. In November 2015, ICAP agreed terms for

462-471: The London Stock Exchange to form the first intercontinental linkage of capital markets . In 1996, the SEC issued a report alleging that Nasdaq market makers fixed prices by avoiding "odd-eighths" quotes (at the time, stock prices were quoted in increments of an eighth of a dollar) to artificially widen spreads. The report was followed by a new set of rules for how Nasdaq handled orders. In 1998, it became

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504-603: The NASDAQ Financial-100 Index, which tracks the largest 100 companies in terms of market capitalization . On March 10, 2000, the NASDAQ Composite stock market index peaked at 5,132.52, but fell to 3,227 by April 17, and, in the following 30 months, fell 78% from its peak. In a series of sales in 2000 and 2001, FINRA sold its stake in the Nasdaq. On July 2, 2002, Nasdaq Inc. became a public company via an initial public offering . In 2006,

546-666: The EMiniCME. Below are the contract specifications for the Nasdaq 100 and derivatives. Nasdaq quotes are available at three levels: The Nasdaq Stock Market sessions, with times in the Eastern Time Zone are: 7:00 a.m. to 9:30 a.m.: extended-hours trading session (premarket) 9:30 a.m. to 4:00 p.m.: normal trading session 4:00 p.m. to 8:00 p.m.: extended-hours trading session (postmarket) The Nasdaq Stock Market averages about 253 trading days per year. The Nasdaq Stock Market has three different market tiers: After

588-478: The European Central Bank, high frequency trading has a substantial correlation with news announcements and other relevant public information that are able to create wide price movements (e.g., interest rates decisions, trade of balances etc.) The scale of changes in price over some unit of time is called the volatility . It was discovered by Benoit Mandelbrot that changes in prices do not follow

630-798: The ICAP Securities and Derivatives Exchange (ISDX), one of only six Regulated Investment Exchanges (RIE) in the United Kingdom, the others being the London Stock Exchange (LSE), the London International Financial Futures and Options Exchange (LIFFE), the London Metal Exchange (LME), the Intercontinental Exchange (ICE) and BATS Chi-X Europe . In September 2013, ICAP settled allegations that they had manipulated

672-624: The U.S. by volume, and ranked second on the list of stock exchanges by market capitalization of shares traded, behind the New York Stock Exchange . The exchange platform is owned by Nasdaq, Inc. , which also owns the Nasdaq Nordic stock market network and several U.S.-based stock and options exchanges . Although it trades stock of healthcare, financial, media, entertainment, retail, hospitality, and food businesses, it focuses more on technology stocks . The exchange

714-482: The UK, the government also borrows from individuals by offering bank accounts and Premium Bonds . Government debt seems to be permanent. Indeed, the debt seemingly expands rather than being paid off. One strategy used by governments to reduce the value of the debt is to influence inflation . Municipalities and local authorities may borrow in their own name as well as receiving funding from national governments. In

756-402: The UK, this would cover an authority like Hampshire County Council. Public Corporations typically include nationalized industries. These may include the postal services, railway companies and utility companies. Many borrowers have difficulty raising money locally. They need to borrow internationally with the aid of Foreign exchange markets . Borrowers having similar needs can form into

798-646: The continued price increases when selling market data . In December 2020, NASDAQ announced that it would strip its indexes of four Chinese companies in response to Executive Order 13959 . In September 2024, the European Commission said it had carried out an unannounced inspection at the offices of Nasdaq over potential anti-competitive practices. Nasdaq 100 futures are traded on the CME (Chicago Mercantile Exchange) while its derivatives, E-Mini Nasdaq 100 and Micro E-Mini Nasdaq 100 futures are traded on

840-534: The disposal of its global hybrid voice broking and information business to Tullett Prebon . The company changed its name from ICAP plc to NEX Group plc in December 2016. In March 2018, it was announced that NEX Group would be bought by American CME Group for US$ 5.5 billion. The acquisition was completed on 2 November 2018. Financial market The term "market" is sometimes used for what are more strictly exchanges , that is, organizations that facilitate

882-543: The eve of the United Nations Conference on Sustainable Development (Rio+20). In November 2016, chief operating officer Adena Friedman was promoted to chief executive officer , becoming the first woman to run a major exchange in the U.S. In 2016, Nasdaq earned $ 272 million in listings-related revenues. In October 2018, the SEC ruled that the New York Stock Exchange and Nasdaq did not justify

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924-403: The financial sector, the term "financial markets" is often used to refer just to the markets that are used to raise finances. For long term finance, they are usually called the capital markets ; for short term finance, they are usually called money markets . The money market deals in short-term loans, generally for a period of a year or less. Another common use of the term is as a catchall for all

966-468: The first stock market in the United States to trade online, using the slogan "the stock market for the next hundred years". The Nasdaq Stock Market attracted many companies during the dot-com bubble . Its main index is the NASDAQ Composite , which has been published since its inception. The QQQ exchange-traded fund tracks the large-cap NASDAQ-100 index, which was introduced in 1985 alongside

1008-421: The form of savings a/c. They can then lend money from this pool of deposited money to those who seek to borrow. Banks popularly lend money in the form of loans and mortgages . More complex transactions than a simple bank deposit require markets where lenders and their agents can meet borrowers and their agents, and where existing borrowing or lending commitments can be sold on to other parties. A good example of

1050-434: The future, at least in the short term. The claims of the technical analysts are disputed by many academics, who claim that the evidence points rather to the random walk hypothesis , which states that the next change is not correlated to the last change. The role of human psychology in price variations also plays a significant factor. Large amounts of volatility often indicate the presence of strong emotional factors playing into

1092-498: The markets in the financial sector, as per examples in the breakdown below. The capital markets may also be divided into primary markets and secondary markets . Newly formed (issued) securities are bought or sold in primary markets, such as during initial public offerings . Secondary markets allow investors to buy and sell existing securities. The transactions in primary markets exist between issuers and investors, while secondary market transactions exist among investors. Liquidity

1134-470: The monthly Stock Guides (stock guides and procedures) issued by Standard & Poor's Corporation. Over the years, it became more of a stock market by adding trade and volume reporting and automated trading systems. In 1981, Nasdaq traded 37% of the U.S. securities markets' total of 21 billion shares. By 1991, Nasdaq's share had grown to 46%. In 1992, the Nasdaq Stock Market joined with

1176-399: The price. Fear can cause excessive drops in price and greed can create bubbles. In recent years the rise of algorithmic and high-frequency program trading has seen the adoption of momentum, ultra-short term moving average and other similar strategies which are based on technical as opposed to fundamental or theoretical concepts of market behaviour. For instance, according to a study published by

1218-493: The public for the first time through IPO (initial public offering). Secondary market is the market where the second hand securities are sold (security Commodity Markets). NASDAQ The Nasdaq Stock Market ( / ˈ n æ z d æ k / ; National Association of Securities Dealers Automated Quotations) is an American stock exchange based in New York City . It is the most active stock trading venue in

1260-636: The regulatory framework becomes particularly critical. In response to the systemic risks exposed by the global economic crisis in 2008, essential regulations such as the Dodd-Frank Act (US) and the EU Market Fundamentals Regulation (MiFID II) were enacted. These regulations have significantly changed the market structure and strengthened supervision and risk management of the derivatives market. Although regulatory measures have enhanced market stability, they have also had

1302-664: The seller to get rid of their asset at a large discount. Financial markets attract funds from investors and channels them to corporations—they thus allow corporations to finance their operations and achieve growth. Money markets allow firms to borrow funds on a short-term basis, while capital markets allow corporations to gain long-term funding to support expansion (known as maturity transformation). Without financial markets, borrowers would have difficulty finding lenders themselves. Intermediaries such as banks , Investment Banks , and Boutique Investment Banks can help in this process. Banks take deposits from those who have money to save on

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1344-834: The status of the Nasdaq Stock Market was changed from a stock market to a licensed national securities exchange. In 2007, it merged with OMX, a leading exchange operator in the Nordic countries, expanded its global footprint, and changed its name to the NASDAQ OMX Group. To qualify for listing on the exchange, a company must be registered with the United States Securities and Exchange Commission (SEC), must have at least three market makers (financial firms that act as brokers or dealers for specific securities) and must meet minimum requirements for assets, capital, public shares, and shareholders. In February 2011, in

1386-535: The stock from the one to the other without using an exchange. Trading of currencies and bonds is largely on a bilateral basis, although some bonds trade on a stock exchange, and people are building electronic systems for these as well. There are also global initiatives such as the United Nations Sustainable Development Goal 10 which has a target to improve regulation and monitoring of global financial markets. Within

1428-424: The study of financial markets and how prices vary with time. Charles Dow , one of the founders of Dow Jones & Company and The Wall Street Journal , enunciated a set of ideas on the subject which are now called Dow theory . This is the basis of the so-called technical analysis method of attempting to predict future changes. One of the tenets of "technical analysis" is that market trends give an indication of

1470-552: The trade in financial securities, e.g., a stock exchange or commodity exchange . This may be a physical location (such as the New York Stock Exchange (NYSE), London Stock Exchange (LSE), Johannesburg Stock Exchange JSE Limited (JSE), Bombay Stock Exchange (BSE), National Stock Exchange of India (NSE) or an electronic system such as NASDAQ . Much trading of stocks takes place on an exchange; still, corporate actions (merger, spinoff) are outside an exchange, while any two companies or people, for whatever reason, may agree to sell

1512-485: The wake of an announced merger of NYSE Euronext with Deutsche Börse , speculation developed that NASDAQ OMX and Intercontinental Exchange (ICE) could mount a counter-bid of their own for NYSE. NASDAQ OMX could be looking to acquire the American exchange's cash equities business, ICE the derivatives business. At the time, "NYSE Euronext's market value was $ 9.75 billion. Nasdaq was valued at $ 5.78 billion, while ICE

1554-460: The world's first electronic stock market. At first, it was merely a "quotation system" and did not provide a way to perform electronic trades. The NASDAQ Stock Market eventually assumed the majority of major trades that had been executed by the over-the-counter (OTC) system of trading, but there are still many securities traded in this fashion. As late as 1987, the Nasdaq exchange was still commonly referred to as "OTC" in media reports and also in

1596-476: Was acquired by CME Group in November 2018. The company developed from a merger between Garban plc and Intercapital plc which created Garban-Intercapital plc in 1999. Intercapital plc was founded by Michael Spencer in 1986 as Intercapital Private Group Limited ('IPGL'); in 1998 it was acquired by Exco plc in a reverse takeover and the enlarged business was renamed Intercapital plc . Garban plc

1638-502: Was established in the 1970s as the financial services division of MAI plc . Several takeovers followed, starting in 1977 when MAI plc acquired Harlow, Meyer and Co . Mallon & Dorney and Garvin GuyButler were acquired by 1982 and in 1983, Garban LLC was acquired giving MAI plc significant broking interests in the UK and overseas. In 1996, MAI plc was merged into United News & Media plc : its financial services division

1680-555: Was founded as a European equivalent to the Nasdaq Stock Market. It was purchased by NASDAQ in 2001 and became NASDAQ Europe. In 2003, operations were shut down as a result of the burst of the dot-com bubble . In 2007, NASDAQ Europe was revived first as Equiduct and was acquired by Börse Berlin later that year. On June 18, 2012, Nasdaq OMX became a founding member of the United Nations Sustainable Stock Exchanges Initiative on

1722-583: Was then de-merged and listed on the London Stock Exchange in 1998 as Garban plc . The company changed its name from Garban-Intercapital plc to ICAP plc in 2001. In 2006 it bought EBS , a major trading platform for foreign exchange. On 5 December 2007, ICAP acquired Traiana, Inc. for $ 247 million (£121 million). Traiana is a provider of post-trade processing, client servicing, and trading software for financial institutions. In June 2012 ICAP acquired Plus Stock Exchange plc and relaunched it as

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1764-662: Was valued at $ 9.45 billion." Late in the month, Nasdaq was reported to be considering asking either ICE or the Chicago Mercantile Exchange to join in what would probably have to be, if it proceeded, an $ 11–12 billion counterbid. In December 2005, NASDAQ acquired Instinet for $ 1.9 billion, retaining the Inet ECN and subsequently selling the agency brokerage business to Silver Lake Partners and Instinet management. The European Association of Securities Dealers Automatic Quotation System (EASDAQ)

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