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Make A Market

 
Investment Dictionary: Make A Market

An action whereby a dealer stands by ready, willing and able to buy or sell a particular security at the quoted bid and ask price.

Investopedia Says:
By being able to make a market allows the brokerage to fill customer orders out of the brokerage inventory, which is faster and easier than filling orders from other brokerages or investors.

Related Links:
Find out the various ways in which a broker can fill an order, which can affect costs. Understanding Order Execution
Learning about these various activities can give insight into how securities are issued and traded. Brokerage Functions: Underwriting And Agency Roles
How do you find the right broker for your investment needs? Start by reading our broker tutorial. Brokers and Online Trading


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Maintain firm bid and offer prices in a given security by standing ready to buy or sell Round Lots at publicly quoted prices. The dealer is called a market maker in the over-the-counter market and a Specialist on the exchanges. A dealer who makes a market over a long period is said to maintain a market. See also Market Maker; registered Competitive Market Maker.

 
 

 

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Investment Dictionary. Copyright ©2000, Investopedia.com - Owned and Operated by Investopedia Inc. All rights reserved.  Read more
Financial & Investment Dictionary. Dictionary of Finance and Investment Terms. Copyright © 2006 by Barron's Educational Series, Inc. All rights reserved.  Read more