ACCT 001 Lecture Notes - Lecture 32: Instinet, Market Maker
31 Aug 2020
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Organization of securities markets nyse (about 3000 securities: exchange physical location, exchange members (amex is similar) Brokers: those who execute customer orders to buy and sell stock on the floor of the exchange. Specialist: nyse member who acts as a dealer on the exchange floor; often called a market maker. One for every stock, although some specialists handle more than one stock. The flow of customer orders to buy and sell securities. Fixed place on the exchange floor where the specialist operates: order flow, specialist"s post, trading in the crowd. Trading that occurs directly between brokers around the specialist"s post. Bonds mainly trade over the counter, similar to nasdaq. Third market: trading of listed stocks away from exchange, block trades, upstairs market , fourth market, unintermediated trading, originally developed for institutions. Electronic communication networks: fully electronic, order-matching system, no intermediary. No capital commitment from a dealer: allows for anonymity, examples. Island, instinet, archipeligo: competing with nasdaq and nyse for volume.
