You may already know what a stock ticker is—the letters that represent a company on the stock market. What about a stock exchange?
In the US, there are a couple major exchanges that companies can list on when they go public. Let's uncover each one.
What is a stock exchange?
Real quick: A stock exchange is a centralized place where companies sell publicly traded securities. Some exchanges are more popular than others, making them a major exchange.
The two standard stock exchanges in the US
Here are the major stock exchanges you should know about before starting to invest in US stocks:
New York Stock Exchange (NYSE): The NYSE is the biggest equities exchange in the world. It also uses an auction system unlike others, which have transitioned to electronic systems.
Nasdaq Exchange (NASDAQ): The NASDAQ is an electronic exchange that focuses on tech-based companies.
Each exchange has its own rules and regulations, like minimum stock price and board transparency. They also charge initial public offering (IPO) and annual listing fees (which add up in addition to fees from the Securities & Exchange Commission). Companies can (and do) get delisted from major stock exchanges for breaking rules.
Who owns these exchanges (& where are they located)?
The parent company that owns the NYSE is Intercontinental Exchange (ICE). ICE took the NYSE over in 2007 when it merged with a European exchange called Euronext. The CEO of ICE is Jeff Sprecher, husband of former US Republican Senator Kelly Loeffler. The NYSE is located on Wall Street in New York City.
The NASDAQ operates using an electronic system, but it also has a New York City headquarters on West 42nd Street. Nasdaq Inc. is also a publicly traded company under the ticker symbol "NDAQ" on its own stock exchange. CEO Adena Friedman spearheads the company.
If a stock isn't on a standard exchange, where is it?
Some US companies trade on over-the-counter (OTC) markets like the Over-the-Counter Bulletin Board and Pink Sheets.
These exchanges often represent cheaper stock from smaller companies. Trading volume is also lower, making the stocks on the OTC markets more volatile than those on standard exchanges. If a stock doesn't adhere to major exchange rules, it can get delisted.
Rather than a centralized exchange, OTC markets operate using a broker-dealer network.
Are there any Halal stock exchanges in the US?
In general, buying stocks is not haram because you're just owning a small percentage of a company. There aren't any Halal stock exchanges in the US, but there are Halal funds that include a bunch of Halal individual stocks. For example, there's the S&P 500 Shariah Index Series, which is up more than 33% in the 12 months ending November 17, 2021.
