Nasdaq Is Preparing for Life Beyond Four-Letter Symbols

By Gaston F. Ceron Dow Jones Newswires
308 words
16 November 2005
The Wall Street Journal
C3
English
(Copyright (c) 2005, Dow Jones & Company, Inc.)

NEW YORK -- Some of your favorite Nasdaq stocks may soon get a face-lift.

Starting early in 2007, the Nasdaq Stock Market will be able to display stock-trading symbols with one, two or three letters for its shares, which now are basically limited to four-letter symbols.

Nasdaq will also be better equipped to handle symbols for New York Stock Exchange and American Stock Exchange stocks, which typically use three or fewer letters, the market said this week.

If Nasdaq companies begin adopting shorter symbols, it would be a big visual change for investors who have grown accustomed to looking at the length of a stock symbol to determine its home market. That usually means stocks with three or fewer letters -- such as Citigroup Inc. (C), General Motors Corp. (GM) or International Business Machines Corp. (IBM) -- are on the NYSE, while four-letter symbols identify Nasdaq stocks, such as Intel Corp. (INTC) or Microsoft Corp. (MSFT).

Indeed, the changes could allow Intel and Microsoft, both Nasdaq mainstays, to finally get their hands on the coveted "I" and "M" symbols without actually switching markets. According to Wall Street lore, the NYSE has long held the symbols in reserve for the technology giants should they ever decide to abandon Nasdaq for the Big Board.

Adena Friedman, a Nasdaq executive vice president, said the markets are trying to come up with a plan to allow for symbol conflicts to be resolved "in an objective manner."

In a memorandum to traders, Nasdaq said the change is being made "to provide full disaster-recovery capabilities for NYSE- and Amex-listed securities," and to improve competition among markets "by breaking down historical barriers for issuers to choose the best possible market for their shareholders."