If NASDAQ is a corporation, does it make profits by charging fees on transactions? When I pay a fee for buying stocks, am I paying the broker or NASDAQ?
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1 Answer
NASDAQ OMX Group owns NASDAQ, a stock exchange.
It is a corporation, and is listed on the NASDAQ as NDAQ.
It makes money by:
- They charge each company to list their stock in their market.
- They charge for transaction that is taking place on their exchange server
- They may be offering other financial or other listing (or IPO) related services in a package deal with contracted third parties.
NASDAQ also charges for market data services, found in the NASDAQ "Datastore".
Other information about the fees charged by NYSE and NASDAQ may be found in the Investopedia article The NYSE And Nasdaq: How They Work.
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3Just to add, the fee you pay goes to the broker. However the broker pays NASDAQ fee that are yearly as well as per transaction.– DheerApr 16, 2012 at 6:16
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2The NASDAQ per-transaction fees appear to be very low: $0.0005 to $0.0035 per share, it looks like, depending on how they actually execute the trade. If you're paying a broker ~$4-$20 a trade and not transacting tens of thousands of shares with each order, the Nasdaq part of that is essentially nothing. nasdaqtrader.com/Trader.aspx?id=PriceListTrading2– user296Apr 20, 2012 at 6:21
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@fennec But that's not really the point; It may be "essentially nothing" to the buyer and seller, but very much significant to NASDAQ, since it occurs for every single share of every NASDAQ stock. Because the $$ volume of total trades is enormous, it surely adds up as sizable income for NASDAQ.– NicoleJun 13, 2018 at 19:19
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@fennec According to NASDAQ they currently transact around 2 billion per day. At your lowest price/share, that would be over $1mil per day! nasdaqtrader.com/Trader.aspx?id=DailyMarketSummary– NicoleJun 13, 2018 at 19:21