A. STOCK EXCHANGES
The New York Stock Exchange has provided an area for trading stock for many years. Today, stock exchanges, such as the New York Stock Exchange and the American Stock Exchange, register with the Securities and Exchange Commission. Trading takes place on the trading floor of the stock exchange by specialists through an auction process.
On May 1, 1975, May Day, members of the New York Stock Exchange could no longer charge a fixed commission on all transactions, so such members began to negotiate commissions.
On October 27, 1986, the day of the Big Bang, the London Stock Exchange eliminated fixed commissions in favor of negotiated commissions as the New York Stock Exchange had on May Day in 1975. The Big Bang in London, England, was important to stock purchasing since the London Stock Exchange is one of the largest in the world. The London Stock Exchange and the Tokyo Stock Exchange in Japan contribute to what has become an almost 24 hour trading day in stocks listed on those exchanges and in New York.
There are also regional stock exchanges registered with the SEC and located in a number of cities in the United States. Such cities as Philadelphia (Pa.), Chicago (Ill.), San Francisco (Cal.), Detroit (Mich.), Cincinnati (Ohio), and Boston (Mass.) have regional stock exchanges. These regional exchanges often list shares of large national companies traded on other exchanges. Such trading is possible through the composite tape and the consolidated quotation system that are part of the national market system. The regional exchanges might also list the shares of local companies not traded on any other exchanges. Also, some exchanges list and trade in options on shares of stock, called puts and calls. A put option is an option to sell a given number of shares of stock at a set price within a certain time period. A call option is an option to purchase a given number of shares of stock at a set price within a certain time period.
GORDON v. NEW YORK STOCK EXCH., INC., 422 U.S. 659 (1975)
SECTION 19(d) OF THE SECURITIES EXCHANGE ACT OF 1934, 15 U.S.C. § 78s(d) (1988)
REGULATION OF THE SECURITIES MARKETS, Securities and Exchange Commission 1996 Annual Report
TRADING ANALYSIS OF OCTOBER 27 AND 28, 1997, Securities and Exchange Commission (September 1998)
B. OVER-THE-COUNTER MARKET
The over-the-counter market consists of the trading in all other securities not traded on a stock exchange. Such trading is done by broker-dealers who act as market makers and buy and sell securities as principals with their own funds and by broker-dealers who act as agents matching buyers and sellers in the market. Many of the larger companies have securities traded on the National Association of Securities Dealers Automated Quotation System (NASDAQ), an electronically linked network providing instant quotations to many investors in many different locations. Most of the remaining companies trade on a less frequent basis with quotes provided by the broker-dealers who trade them to information gathering organizations who then publish the results, such as the well-known pink sheets.
NEWTON v. MERRILL LYNCH, PIERCE, FENNER & SMITH, INC., 135 F.3d 256 (3d Cir. en banc 1998)
REGULATION OF EXCHANGES AND ALTERNATE TRADING SYSTEMS, Securities Exchange Act Release No. 34-40760 (December 8, 1998)
NASD RULE CHANGE RELATING TO ECN AND ATS PARTICIPATION IN THE ITS/CAES SYSTEM, Securities Exchange Act Release No. 34-42536 (March 16, 2000)
C. SUSPENSION OF TRADING
The Securities and Exchange Commission has the authority to suspend trading in the securities of a company if it is necessary to do so for the protection of investors. This situation can arise where material information is not on file with the SEC or where misinformation or false information is available to investors through filings or other means such as press releases or news stories.
SEC v. SLOAN, 436 U.S. 103 (1978)
SECTION 12(k) OF THE SECURITIES EXCHANGE ACT OF 1934, 15 U.S.C. § 78l(k) (1988)
© 2000 Harry Stansbury
 See JEAN STROUSE, MORGAN 66 (1999).
 ROBERT SOBEL, N.Y.S.E. 12-13 (1975).
 ROBERT SOBEL, AMEX 217-19 (1972).
 15 U.S.C. § 78e (1988).
 See CHRIS WELLES, THE LAST DAYS OF THE CLUB 8-16 (1975); see, e.g., Gordon v. New York Stock Exch., Inc., 422 U.S. 659 (1975); Silver v. New York Stock Exch., 373 U.S. 341 (1963).
 See RON CHERNOW, THE HOUSE OF MORGAN 602-03 (1990); MARTIN MAYER, MARKETS 224 (1988). See generally Arlene Hershman, Big Shift on Wall Street, Dun's Rev., May 1976, at 39.
 See MARTIN MAYER, MARKETS 189-200 (1988).
 See PAUL FERRIS, THE CITY 18-29 (1960); Roberta S. Karmel, `Big Bang' in London, N.Y. L.J., Dec. 20, 1984, at 1.
 See PAUL FERRIS, THE MASTER BANKERS 176 (1984); Bryan Burrough, Craig Forman & Kathryn Graven, How Merrill Lynch Moves Its Stock Deals All Around the World, Wall St. J., Nov. 9, 1987, at 1.
 2 FED. SEC. L. REP. (CCH) ¶ 21,310.10.
 See SEC, REPORT OF SPECIAL STUDY OF SECURITIES MARKETS, H.R. DOC. NO. 95, 88th Cong., 1st Sess., pt. 2, at 911-912 (1963); 37 SEC ANN. REP. 73-74 (1971); The Regional Stock Exchanges Fight for Survival, Fortune, Nov. 1973, at 118.
 See LOUIS LOSS, FUNDAMENTALS OF SECURITIES REGULATION 598-99 (2d ed. 1988).
 See Norman S. Poser, Restructuring the Stock Markets: A Critical Look at the SEC's National Market System, 56 N.Y.U. L. Rev. 881, 915-45 (1981).
 See Carl W. Schneider, Joseph M. Manko & Robert S. Kant, Going Public - Practice, Procedure and Consequences, 27 Vill. L. Rev. 1, 41-44 (1981).
 See MARTIN MAYER, MARKETS 90 (1987); JOEL SELIGMAN, THE SEC AND THE FUTURE OF FINANCE 82-83 (1985).
 LOUIS LOSS, FUNDAMENTALS OF SECURITIES REGULATION 233-35 (2d ed. 1988); MARTIN MAYER, MARKETS 47-48 (1987); JOEL SELIGMAN, THE SEC AND THE FUTURE OF FINANCE 83-84 (1985).
 LOUIS LOSS, FUNDAMENTALS OF SECURITIES REGULATION 233-35 (2d ed. 1988); MARTIN MAYER, MARKETS 47-49 (1987); JOEL SELIGMAN, THE SEC AND THE FUTURE OF FINANCE 83-84 (1985).
 See, e.g., VINCENT P. CAROSSO, INVESTMENT BANKING IN AMERICA 103 (1970); ROBERT SOBEL, INSIDE WALL STREET 67‑90 (1977). See generally Saul Hansell, The Wild, Weird World Of Electronic Exchanges, Institutional Inv., Sept. 1989, at 91.
 See JOHN BROOKS, THE GO-GO YEARS 21-25 (1973); ROBERT SOBEL, N.Y.S.E. 330-54 (1975).
 See VINCENT P. CAROSSO, MORE THAN A CENTURY OF INVESTMENT BANKING 155 (1979); Eric A. Chiappinelli, Red October: Its Origins, Consequences, and the Need to Revive the National Market System, 18 Sec. Reg. L.J. 144, 162-63 & n.64 (1990).
 See JOEL SELIGMAN, THE SEC AND THE FUTURE OF FINANCE 18-20 (1985).
 See 5 LOUIS LOSS, SECURITIES REGULATION 3317-20 (2d ed. Supp. 1969).
 15 U.S.C. § 78l(k) (1988).
 See LOUIS LOSS, FUNDAMENTALS OF SECURITIES REGULATION 446-49 (2d ed. 1988).