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Market Surveillance

The department responsible for investigating and preventing abusive, manipulative, or illegal trading practices on The NASDAQ Stock Market. Considerable resources are devoted to surveilling The NASDAQ Stock Market. A vast array of sophisticated automated systems reviews each trade and price quotation on an on-line, real-time basis. Off-line computer-based analyses are conducted to evaluate trading patterns on a monthly, weekly and daily basis.

Additional Comments:

Whenever any of these automated systems indicate unusual price or volume in a stock, NASDAQ Market Surveillance analysts determine if this was the result of legitimate market forces or perhaps a violation of rules. Among other things, analysts review press releases, review historical trading activity, interview brokers, Market Makers, and NASDAQ-listed company officials. Market Surveillance continues its inquiries until unusual movements are adequately explained.

If legitimate market forces were at work the case is closed without action. If it appears rule violations have occurred, a disciplinary action is initiated. Where corporate insiders or members of the investing public are involved in a potential violation, the case will be referred to the SEC.

Related Terms:

Trading Halt
The temporary suspension of trading in a NASDAQ security, usually for 30 minutes, while material news ...

Bulletin Board Shell
A blank check or shell company whose securities trade on the Over-the-Counter Bulletin Board. ...

Insider Trading
Making investment decisions based on information that is not yet public. Although trading based on this ...

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