Glossary

  • broker markets - National and regional securities exchanges that bring buyers and sellers together through brokers on a centralized trading floor.
  • circuit breakers - Corrective measures that, under certain conditions, stop trading in the securities markets for a short cooling-off period to limit the amount the market can drop in one day.
  • dealer markets - Securities markets where buy and sell orders are executed through dealers, or “market makers,” linked by telecommunications networks.
  • electronic communications networks (ECNs) - Private trading networks that allow institutional traders and some individuals to make direct transactions in the fourth market.
  • insider trading - The use of information that is not available to the general public to make profits on securities transactions.
  • National Association of Securities Dealers Automated Quotation (NASDAQ) system - The first and largest electronic stock market, which is a sophisticated telecommunications network that links dealers throughout the United States.
  • over-the-counter (OTC) market - Markets, other than the exchanges, on which small companies trade; includes the Over-the-Counter Bulletin Board (OTCBB) and the Pink Sheets.