Crossed market

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Crossed market

In the context of general equities, happens when the inside market consists of a highest bid price that is higher than the lowest offer price. See: Overlap the market.

Crossed Market

A situation in which the bid for a security exceeds the ask. That is, a crossed market occurs when the highest price that a buyer is willing to pay is higher than the lowest price a seller is willing to take. This is fairly unusual and characterizes a highly volatile security. A crossed market is most common on NASDAQ when orders are entered before the opening.

crossed market

A situation in which one market maker's ask price for a security is lower than another market maker's bid price for the same security.

Crossed market.

A market in a particular stock or option is described as crossed when a bid to buy that stock or option is higher than the offer to sell it, or when an offer to sell is lower than a bid to buy.

A crossed market reverses the normal relationship of a stock quotation in which the bid price is always lower than the ask price. It's illegal for market makers to cross a market deliberately.

A crossed market may occur when investors place after-hours orders electronically for execution at opening, or when investors trade directly through an electronic communications network (ECN).

NASD has introduced a set of pre-opening procedures for market makers on the Nasdaq Stock Market. They help prevent the confusion and potential inequalities in pricing that a crossed market can produce.

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Locked and crossed markets adversely effect an orderly market opening and efficient price discovery because many firms do not execute customer orders during locked and crossed markets or execute such orders at unfavorable prices.
The disciplinary actions announced today resulted from violations of the NASD's locked and crossed markets rule.
In the past 18 months, NASD Regulation has brought approximately 35 cases for locked and crossed markets violations.
In addition, MetaECN offers powerful trading capability to address the problem of locked and crossed markets, which have grown dramatically due to the fragmentation of the equities market.
This case, which began with complaints about locked and crossed markets from other market makers, was uncovered after a lengthy investigation by the Market Regulation Department.
Locked and crossed markets resulted from this manipulative bidding activity.