When you place an order with your brokerage firm, the brokers trading staff

executes that order wherever it can get the best deal. But is that the best deal
for you, or for the brokerage firm? Its tough to know the right answer. In gen-
eral, firms that do more trading and participate in several exchanges and
electronic communications networks can get you the best execution. (To
learn more about choosing brokerage firms, turn to Chapter 6.)
The financial markets are in a state of flux, with a lot of mergers and acquisi-
tions among the exchanges. The information here might be obsolete when
you read it, which I think is fascinating. It wasnt so long ago that these
exchanges were staid organizations run like private clubs.
The New York Stock Exchange (NYSE)
The New York Stock Exchange is the Big Kahuna of stock exchanges. Most of
the largest U.S. corporations trade on it, and they pay a fee for that privilege.
The 2,000 or so companies listed on the exchange are known by their ticker
symbols, shorthand for the company name. On the New York Stock Exchange,
all ticker symbols have three letters or fewer, and many old companies have
one-letter symbols, like F for Ford and T for AT&T.
Two of the largest companies in the world, Intel and Microsoft, are not listed
on the New York Stock Exchange, and supposedly, exchange officials have
told both companies that if they move to the NYSE, they can have the ticker
symbols I and M, which were unassigned for decades. In 2007, the NYSE gave
the M symbol to Macys, formerly Federated Stores, but as this book was
going to press, Macys was rumored to be acquired by a private equity firm,
so M may be available once again to tantalize Mr. Gates and company.
In order to be listed on the New York Stock Exchange, a company generally
needs to have at least 2,200 shareholders, trade at least 100,000 shares a
month, carry a market capitalization (number of shares outstanding multi-
plied by price per share) of at least $100 million, and post annual revenues
of at least $75 million.
The New York Stock Exchange is more than 200 years old, but it has been
going through some big corporate changes in order to stay relevant. Its a
floor-based exchange. The trading area is a big open space in the building,
known as the floor. The floor broker, who works for the member firm,
receives the order electronically and then takes it over to the trading post,
which is the area on the floor where the stock in question trades. At the
trading post, the floor broker executes the order at the best available price.
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Part I: Day Trading Fundamentals
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