2. Brief NYSE HistoryBrief NYSE History  May 17, 1792  Electronic in 2006  Euronext in 2007  Intercontinental Exchange in 2012 (Pending)

3. Players in the Trade GamePlayers in the Trade Game  Brokers  Commission broker  Independent floor broker Independent floor broker  Specialist  Agent  Catalyst  Dealer  Auctioneer

4. What does a specialist do?What does a specialist do?  Market-makers  Can represent multiple stocks  One specialist per stock  Fair and orderly market  Close a stock’s market  Provide liquidity  “Pilots”  Now Designated Market Makers Now Designated Market Makers

5. DMM

6. Physical Trade ExecutionPhysical Trade Execution  Place an order  Order sent to NYSE broker  Commission broker locates post  Order submission to specialist/DMM  Entered in order book  Deal made or not made

7. NASDAQ v NYSENASDAQ v NYSE  NASDAQ  Electronic only  Dealer’s market (quote-driven)  Fragmented  NYSE  Physical floor and electronic  Auction market (order-driven)  One point of sale

8. References  Fabozzi, F., Modigliani, F., & Jones, F. (2010). Foundations of Financial Markets and institutions. New York: Prentice Hall.  Kocic, A. (2013). NASDAQ vs. New York Stock Exchange. Retrieved April 22, 2013, from eHow Money: http://www.ehow.com/about_7510488_nasdaq-new-york-stock-exchange.html  NASDAQ. (2013). What is NASDAQ. Retrieved April 20, 2013, from NASDAQ Web Site: http://www.nasdaqomx.com/aboutus/whatisnasdaq/  NYSE Euronext. (2012). Designated Market Makers. New York: NYSE.  NYSE. (2009). Inside the NYSE: The Specialist. Retrieved April 22, 2013, from NYSE Mag Article: http://www.nyse.com/pdfs/specialistmagarticle.pdf  NYSE. (2013). New York Stock Exchange History. Retrieved April 20, 2013, from NYSE Euronext: http://www.nyx.com/who-we-are/history/new-york  NYSE. (2008). Next Generation Model. New York: New York Stock Exchange.  NYSE. (2006). Stock Market Savvy. Retrieved April 21, 2013, from NYSE: http://www.nyse.com/pdfs/TG_Mech.pdfhttp://www.nyse.com/pdfs/TG_Mech.pdf