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Economics New York Stock Exchange

Terms in this set (55)

1) Amanda Smith of Hartford, CT, decides to buy Great Computer Company stock. She calls the local stockbroker who works for a firm that is a member of the NYSE.

2) Amanda asks her stockbroker the current price for Great Computer Company stock. The broker checks the quote (the highest bid to buy, the lowest offer to sell) for the Great Computer Company stock using an electronic market data system.

3) The stockbroker gives Amanda the current price of Great Computer Company and she instructs the stockbroker to buy 100 shares.

4) The broker sends the order to the Trading Floor of the NYSE electronically via the SuperDOT system to the specialist's workstation or through Broker Booth Support System (BBSS) the broker's handheld computer.

5) At the trading post, the specialist that handles Great Computer Company stock makes sure the transaction is executed in a fair and orderly manner. Amanda's order competes with other orders in the Great Computer Company plus any applicable commissions.

6) After the transaction is executed, the specialist's workstation sends notice to Amanda's firm (the buyer) and to the seller's firm, as well as to the consolidated tape so that a written record is made.

****7) The transaction is reported by computer and appears within seconds on the consolidated tape displays across the country and around the world.

****8) The transaction is processed electronically. Amanda receives a trade confirmation from her broker's firm describing the trade, and the exact amount she owes for the 100 shares of Great Computer Company plus any applicable commissions.