The author introduces Frank Hatheway and Peter Martyn of NASDAQ and highlights the complexities of trading stocks electronically.

The latest draft of Regulation NMS, the Securities and Exchange Commission’s proposal for market structure reform, is now out for comment, and the commission has promised action soon after the comment period closes. The regulation, by extending the so-called trade-through rule to Nasdaq and covering all orders that are accessible...

The central question in securities-market structure is whether investors are better served by human-mediated markets, such as the specialist system of the New York Stock Exchange, or by electronic markets, such as NASDAQ and the Electronic Communication Networks. The Securities and Exchange Commission's recent Regulation NMS, although it purports to...

At an AEI conference last June, Professor Kenneth M. Lehn and his colleagues presented a ground-breaking paper that compared the effect of market stress—when the markets receive new positive or negative information—on the bid-ask spreads in the NYSE, NASDAQ, and the electronic communications networks (ECNs). The June paper indicated that...

In the last decade, the majority of the world’s stock markets have converted to electronic platforms. In the United States, the New York Stock Exchange remains a human-mediated auction market operated by specialists. The NASDAQ market, however, is electronic, made up of multiple market makers who trade over a network...