Similarities & Difference Between Nasdaq & Nyse

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The NYSE and NASDAQ are both electronic stock exchanges in the United States and are regulated by the Stock Exchange Commission. They both deal with equity trading and connect buyers and sellers. However, the NYSE has higher listing requirements and is an auction market while NASDAQ is an over-the-counter market that mainly deals with technological clients. The WorldCom Inc. scandal was caused by Bernard Ebbers, the former CEO, who committed accounting fraud by misrepresenting the financial statements and presenting false reports to investors. This led to a decline in the company’s image and decreased investment in the telecommunication industry.

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Similarities & Difference between NASDAQ & NYSE Similarities between Both Markets The NYSE and the NASDAQ have the following similarities – The NASDAQ and NYSE equally use and are screen based electronic stock exchanges which means they utilize electronic screens during trading. Both of these exchanges consist of the majority of the equities traffic in the United States. as well as the major exchange traders in the United States. These two exchanges are also synchronized by the Stock Exchange Commission. The NASDAQ and the NYSE partake in the trading of stock equities as well as help to meet the buyer and supplier.

Differences between NYSE & NASDAQ The NYSE and NASDAQ have the following inconsistencies. The listing requirements for NYSE are higher when compared to the NASDAQ. The NASDAQ is and over the counter market while the NYSE is auction market based. The NYSE deals with small and midsized organizations, while on the other hand the NASDAQ functions within the majority field of technological clients. While each stock within NYSE has specialists to manage that specific stock, this feature is not incorporated in to the NASDAQ.

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The NYSE is not publicly traded while the NASDAQ is, allowing the public to trade stocks on it (NYSE And NASDAQ, n. d ) WorldCom Inc. The WorldCom Inc was a telecommunication corporation. Bernard Ebbers was the former Chief Executive of the corporation. He was ultimately found guilty of accounting crimes which lead to a huge scandal. He constructed the unification with MCI, which at the time was the largest technology company in the US. This merger allowed a breakthrough into the monopoly AT&T had on the telecommunication industry at the time.

The Scandal cause by Ebbers ultimately produced the ultimate demise and bankruptcy of the WorldCom Inc. Corporation. The accounting scandal comprised the sum of eleven million dollars, which in turn resulted in the decreased value to the investors. Mr. Ebbers created his crime by misrepresenting the financial statements and presented false reports to investors showing a more positive view of the company then was true. He did this to attract more investors to the company, which he felt would ultimately help the company with future projects.

However after the scandal broke, the company’s positive corporate image severely declined due to the Ebbers case, which ultimately lead to the companies demise (Crawford, 2005). Investors began to pull back from the company and many showed faltering investment interest in the stock of the company. This was due to alarm over the actual accounting abnormalities. Once accurate financial statements were obtained, there was a large reduction with the actual earnings of the corporation. The fraud perpetrated by Bernard Ebbers lead to an overall decrease in sales volume within the telecommunication industry.

The public became more leery of investments and wanted more safety from their investment, before increasing value/ or funds within their investments. This ultimately led to investors making less funds available within the tele-communication industry for their projects or the business operations. References Author Unknown (2008). NASDAQ vs. NYSE Tutorial. Retrieved January 11, 2010, from http://www. investopedia. com/university/electronictrading/trading1. asp Author unknown, The NYSE And NASDAQ: How They Work . Investopedia Staff(n. d), Retrieved on January 11, 2010 from http://www. investopedia. com/articles/basics/03/103103. asp

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