Let's take a little time to discuss who the major exchanges are and the
basic way a trade is handled. There are some regional exchanges that
are fairly well know, but we won't be using them for any transactions. We
will stay focused on the big-three exchanges.

The New York Stock Exchange is the largest stock exchange in America.
It's located on Wall Street in New York City. Close to 2000 of the biggest
corporations in the United States have their stock listed on this exchange.
These are the Blue-Bloods of the American business scene.

The American Stock Exchange is next on our list. It's very similar to the
NYSE as to the manner in which it operates. I would guess that about 800
to 1000 companies have their stock listed on this exchange at any given
moment. As of this date the Nasdaq and Amex are talking about a merger.

Third on the list is the Over-The-Counter Market. This association has
more listed securities than any of the others. The OTC association is a
tight knit group of securities houses located in major cities all across the
United States.

OTC securities dealers belong to a nonprofit organization known as the
NASD (National Association of Securities Dealers). They use a computer
trading system known as NASDAQ, that provides brokers and dealers
with price quotations for each security traded over the counter.

The stocks we'll be looking for will be listed on these three exchanges.
The primary difference between the three exchanges is that each one
has different listing requirements. Stocks listed on the NYSE must meet
the strictest requirements, while the ASE and OTC are less demanding.

Stocks move around from one exchange to another due to the different
requirements imposed by each exchange. Stocks on the NYSE get great
visibility, so it's desirable to be listed there. There are also different rules
on each exchange for raising capital (selling stock state by state, etc).