Abstract Tech

Igniting Economic Growth with Liquidity

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MarketInsite Nasdaq Blog

Every day, more than $500 billion in stocks is traded around the world. Dozens upon dozens of exchange-traded products are created annually, swelling to become a multi-trillion business. And each year, hundreds — sometimes thousands — of companies around the world enter the public markets, leveraging their newfound capital to accelerate their growth ambitions, which, in turn, helps drive communities and economies forward.  

With the markets constantly moving, liquidity is essential to ensuring a well-functioning financial system. With greater liquidity in the markets, we can connect more buyers and sellers, making it easier for them to match with counterparties, thereby helping to lower the cost of investing while also improving price stability and discovery, as well as portfolio diversification.  

How can we enhance market liquidity?  

As the trusted fabric of the financial system, Nasdaq understands how market structure, while built on timeless principles, must evolve to meet modern demands and recognizes our responsibility, along with other financial market infrastructures (FMIs), to ensure liquidity, fairness and efficiency that leads to inclusive growth.  

To enable global markets to be equipped to maximize liquidity, Nasdaq’s Market Platforms division has developed a dedicated suite of solutions designed to address evolving investor and issuer needs while elevating the trading experience for all market participants through a comprehensive set of functionalities, order types and price discovery methods. 

“The technology that we use to underpin the Nasdaq exchanges in the U.S. and Europe, we also now provide to more than 130 other organizations around the world to help them grow and expand their economies,” said Nasdaq Chair and Chief Executive Officer Adena Friedman.  

As the home to over 5,200 listings with a market value of nearly $29 trillion across Nasdaq’s U.S., Nordic and Baltic exchanges, Nasdaq’s investments in technology and infrastructure are designed to ensure stability and resiliency through various stages of the market, bringing together buyers and sellers when they are needed most. We are continuously refining our ability to capture high-quality liquidity with technology that bolsters efficiency and enables innovation that attracts differentiated and new liquidity. Through this technology, we strive to help companies tap into deeper markets by providing price transparency and fair price discovery while ensuring the integrity of order flows, all of which will help attract investors and connect them with a wider world of possibilities. This creates a flywheel effect with listings as companies will seek out venues with greater liquidity that can attract a broader swath of participation.  

With 10 North American exchanges, including our flagship U.S. exchange, The Nasdaq Stock Market, we offer diverse venues that enable investors to find liquidity that complements their trading strategy. For instance, Nasdaq BX uses the Retail Price Improvement Program (RPI) that encourages enhanced cost savings for individual investors while offering unparalleled liquidity and transparency.  

Meanwhile, Nasdaq PSX is Nasdaq’s fastest-growing exchange with market quality-driven liquidity incentives, serving as a natural starting point for firms to grow exchange-based liquidity strategies. 

In Europe, Nasdaq operates seven additional exchanges in Stockholm, Helsinki, Copenhagen, Iceland, Vilnius, Tallinn and Riga.  

Nasdaq European Exchanges

“Our European Market Service is a vibrant growth engine for northern European markets and plays a key role in advancing our core mission to modernize markets,” said Roland Chai, President of European Market Services. “Our team has worked tirelessly to keep driving our technology leadership, marketplace excellence and strong commitment to sustainability to create a world-class capital market offering for both companies and investors in times of uncertainty.” 

Beyond our exchanges, we support global market infrastructure operators across the trade lifecycle, from issuance and trading to clearing, settlement, and custody. We help enable efficient set-up and build-out of new markets and modernization of existing infrastructures with a flexible and stepwise approach.  

Furthermore, through Nasdaq’s matching engine technology, exchanges and marketplaces of all sizes and asset classes can keep pace with the ever-changing market requirements with comprehensive functionality, ultra-performance and operational resilience.  

Our efforts, however, don’t stop at the public markets. Private markets play a critical role in the overall health and functioning of our markets and economy. Since we initially entered this space in 2013, our focus has been on addressing salient liquidity challenges in this market. Today, Nasdaq opens access to liquidity for private funds as Nasdaq Fund Secondaries (NFS), which supports the end-to-end execution of GP-led and LP-led transactions on one platform. We are applying our technology, regulatory infrastructure, and expertise in this space to bring greater efficiency and scalability to private fund secondary transactions. 

We’re proud to provide the technology that powers global exchanges across the world, enabling the broader financial community to have greater access to liquidity to grow and scale their local economies. 

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