DEFINITION A computerized system that facilitates trading and provides price quotations on more than 5,000 of the more actively traded over the counter stocks. Created in 1971, the Nasdaq was the world's first electronic stock market. Stocks on the Nasdaq are traditionally listed under four or five letter ticker symbols. If the company is a transfer from the New York Stock Exchange, the symbol may be comprised of three letters. NASDAQ originally was the acronym for the National Association of Securities Dealer Automated Quotation system. NASDAQ was founded in 1971, and provided quotes for Over-the-Counter (OTC) stocks not listed on other markets. For that reason, it became associated in people's minds with technology stocks.

The main difference is that the NASDAQ is an exchange, much like the New York Stock Exchange, whereas the Dow and the S&P 500 are indices that track the performance of selected stocks. The NASDAQ reports on all the performance of all the companies that have listed with it. When people refer to the Dow, they are referring to one of three indices, the Dow Jones Industrial Average. This follows the stock prices of 30 companies selected by the editors of the Wall Street Journal to represent their industries. They tend to be large, well-known companies like General Electric and Kraft Foods. The S&P 500 tracks the 500 most widely held stocks on the NYSE. The S&P 500 tends to be broader, hoping to have a bigger representation of companies from various sectors and industry groups. Since it has more financial stocks than either the NASDAQ or the Dow, it hasn't performed as well as the other two since the 2008 financial crisis.

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