Crossed market

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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References in periodicals archive ?
A locked market occurs when the bid price equals the sell price in the same security, and a crossed market occurs when the bid price is greater than the sell price of a security.
The Committee found this activity to be an element of the manipulative scheme as well as violative of the NASD Rule governing locked and crossed markets, but did not conclude that Morgan Stanley's written supervisory procedures were inadequate to deter locked and crossed market activity.
Locked and crossed markets resulted from this manipulative bidding activity.
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 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.