What is 'Nasdaq Intermarket'

Nasdaq Intermarket is a system that was implemented and managed by Nasdaq to allow for networking, communication and trading activity among those participating in several markets via an electronic means. This network utilized the intermarket trading system (ITS), which is an electronic network linking the trading floors of several markets, allowing real-time communication and trading between them. This ITS platform allows any broker on the floor of one of the participating exchanges to coordinate an execution, reacting immediately to price changes. The ITS is managed by the Securities Industry Automation Corporation (SIAC).

BREAKING DOWN 'Nasdaq Intermarket'

Nasdaq Intermarket was an electronic marketplace where National Association of Securities Dealer  members could execute trades, communicate, and receive quotations on stocks listed on the New York Stock Exchange and the American Stock Exchange ). Formerly known as Nasdaq's third market, Nasdaq Intermarket used Nasdaq's Computer Assisted Execution System to connect buy and sell orders.

Nasdaq Intermarket competed for retail stock orders with regional exchanges such as the Chicago Stock Exchange (CHX) and the Boston Stock Exchange (BSE). By connecting several stock exchanges, the intermarket system gave traders access to additional buyers and sellers, increasing liquidity and competition, and increasing available investing capital.

History of Nasdaq Intermarket

Nasdaq had been a part of the ITS since its creation in the 1980s, but in 2005, Nasdaq announced its intentions to withdraw from the ITS the following year. The ITS was originally created when most trading was done via a manual process by floor-based traders. Technological advances since that time have introduced new and more innovative systems for conducting trade activity in a fast, connected atmosphere. In announcing its withdrawal from the ITS, Nasdaq cited the outdated setup of the system, and said a private, more efficient and high-tech linking system would be a better option. That position aligned perfectly with Nasdaq’s recent acquisition at that time of Brut, LLC, which maintained an electronic communications network.

Nasdaq now has a platform called the Nasdaq Market Center, which uses Brut tools in an electronic communications network, or ECN. This ECN can enable automated, electronic communication and activity. Brut systems are linked to other market centers trading Nasdaq securities, along with national securities exchanges such as the NYSE. Since its acquisition of Brut, Nasdaq has integrated that system with other tools including SuperMontage and INET to form a comprehensive system that was at one point known as Single Book, later to be referred to as the NASDAQ Market Center Execution System.

  1. Intermarket Sector Spread

    Intermarket sector spread is the yield spread between two fixed-income ...
  2. Intermarket Surveillance Information ...

    The Intermarket Surveillance Information System - ISIS - is a ...
  3. Last-Sale Reporting

    Last-sale reporting is the submission of details about the quantity ...
  4. NASDAQ Global Select Market Composite

    NASDAQ Global Select Market Composite is a market capitalization-weighted ...
  5. Z

    Z is a Nasdaq stock symbol specifying that a stock is a miscellaneous ...
  6. Electronic Communication Network ...

    An electronic system that attempts to eliminate the role of a ...
Related Articles
  1. Trading

    Intermarket relationships: Following the cycle

    Learn more about the interactions between commodity, bond, stock and currency markets.
  2. Investing

    Intermarket Analysis: Pinpointing Reversals And Confirming Trends

    Learn how to confirm your analysis based on intermarket trends by watching global markets and particular stocks to pinpoint reversals.
  3. Insights

    The NYSE and Nasdaq: How They Work

    Learn some of the important differences in the way the NYSE and Nasdaq exchanges operate and the securities that trade on them.
  4. Insights

    Nasdaq Goes to Bat for Company Founders

    Jeff Thomas, Nasdaq's head of West Coast operations, outlines why the exchange is making a case for startups.
  5. Trading

    Electronic Trading Tutorial

    Learn about the systems that run the market.
  6. Trading

    The Death Of The Trading Floor

    Electronic trading has almost completely replaced face-to-face human trading.
  7. Tech

    Nasdaq CEO Hints at Future Cryptocurrency Exchange

    Nasdaq may consider becoming a cryptocurrency exchange, pending regulation.
  8. Investing

    Strategies to Trade the Nasdaq Index

    The Nasdaq is by far the best-known technology index in the world and there are plenty of strategies to trade the Nasdaq using ETFs and options.
  1. What is the difference between the Dow and the Nasdaq?

    The Dow refers to the Dow Jones Industrial Average (DJIA) index, while the Nasdaq refers to the Nasdaq Composite Index. Read Answer >>
  2. What exactly is being done when shares are bought and sold?

    Most stocks are traded on physical or virtual exchanges. The New York Stock Exchange (NYSE), for example, is a physical exchange ... Read Answer >>
  3. What are the differences between AMEX and Nasdaq?

    While similar in purpose, the American Stock Exchange (AMEX) and the National Association of Securities Dealers Automated ... Read Answer >>
  4. Why are Traders on the Floor of the Exchange?

    Learn how trading on the floor of the stock exchange has evolved over time with computers now managing the majority of buying, ... Read Answer >>
  5. What's the difference between a Nasdaq market maker and a NYSE specialist?

    What's the main difference between a specialist and a market maker? Not much. Both the New York Stock Exchange (NYSE) specialist ... Read Answer >>
Trading Center