NASDAQ is the largest U.S. electronic stock market. With approximately 3,200 companies, it lists more companies and, on average, trades more shares per day than any other U.S. market. It is home to companies that are leaders across all areas of business, including technology, retail, communications, financial services, transportation, media and biotechnology. NASDAQ is the primary market for trading NASDAQ-listed stocks. 

In 1961 the US Congress authorised the Securities and Exchange Commission (SEC) to conduct a study of fragmentation in the over-the-counter market (our data for 1938-1970 refers to this pre-NASDAQ market). The SEC proposed automation as a possible solution and charged the National Association of Securities Dealers, Inc. (NASD) with its implementation.

NASDAQ (originally an acronym for National Association of Securities Dealers Automated Quotations) was founded in 1971 by the National Association of Securities Dealers (NASD), who divested it in a series of sales in 2000 and 2001. It is owned and operated by The Nasdaq Stock Market, Inc. (NASDAQ: NDAQ) which was listed on its own stock exchange in 2002.

Global Financial Data says that NASDAQ initiated its sector indices on February 5, 1971 and all the indices use that date as their base except for the Telecommunications index (formerly the Utilities Index) which was rebased to October 29, 1993 = 200 (the Telecommunications index can be converted into the old Utilities index by multiplying the data by 5.74805). The indices are capitalization weighted and include all shares traded on the NASDAQ; however, because the indices are capitalization weighted, they act more like large-cap tech indices than small-cap indices since Intel, Microsoft and other shares represent a substantial portion of the NASDAQ index. All the primary NASDAQ indices are provided complete from their beginning.

1938-2006

Prior to the introduction of the NASDAQ indices, the National Quotation Board, which oversees the over-the-counter market, kept two indices of OTC stocks, one of 35 industrials and one of 15 insurance stocks. The industrial stock average was introduced on November 7, 1948 using the Dow method of price weighting and a divisor using the OTC stocks with the largest market value, largest number of stockholders and the most substantial quotation records. The index was calculated backwards to October 1, 1938 making calculations on the first, tenth and twentieth of each month.

Source: Global Financial Data

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