Two of the three major institutions of the financial market trade organizations are AMEX (American Stock Exchange) and NASDAQ (National Association of Securities Dealers Automated Quotation System); the third being the NYSE (New York Stock Exchange). These two markets have contributed to the wealth of the economy and individuals since the 1800's for AMEX and 1971 for NASDAQ. Following a merger in 1998 forming NASDAQ-AMEX this company is now better equipped to compete with the NYSE. (ADVFN PLC, 2007) AMEX also operates separately from NASDAQ but under this parent company. By looking at the similarities and differences of these companies one will gain a greater knowledge of how the financial market works. In the closing of this paper one will see how the Chief Executive of WorldCom, Bernard Ebbers case, affected WorldCom Inc. and the telecommunications industry.
In the conception of AMEX trading was held on the curbside of Broad Street in New York. Curb Brokers would gather around mailboxes and other areas of congestion putting up lists of stock for sale. These proceedings soon began to become congested and the noise so loud that hand signals had to be developed. These signals are still used today. The main objective of AMEX was to buy and sell stock in which they had succeeded greatly. In 1992 AMEX used the SEC's (Security and Exchange Commission) "Super Trust Order" to pave they way for the first stand alone index based ETF (Exchange Traded Fund). (ETFGuide, 2007) NASDAQ was the first electronic stock market. This OTC (Over-The-Counter) exchange also has the main objective of buying and selling stock, securities, and funds. They later fol ...