Fast Market

Fast market

Excessively rapid trading in a specific security that causes a delay in the electronic updating of its last sale and market conditions, particularly in options.

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fast market

A market in which sudden increases in the demand or supply of shares cause sharp price movements of a stock. Market orders in a fast market are subject to being executed at prices substantially different from the prices in effect at the time the orders were entered.

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Fast Market

An exchange or financial market undergoing an extreme amount of volatility with high trading volume. A fast market may occur as the result of both positive and negative events: an IPO may attract greater interest than expected or a publicly-traded company may release unexpectedly pessimistic earnings forecasts. Trades occur so rapidly that market orders may be executed at a very different price from the price at the time the order was placed. Fast markets are often thought to be unsustainable and some analysts advise investors to exercise caution when buying or selling securities in them.

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Fast market. A fast market is one with heavy trading and rapidly changing prices in some but not necessarily all of the securities listed on an exchange or market.

In this volatile environment, which might be triggered by events such as an initial public offering (IPO) that attracts an unusually high level of attention or an unexpectedly negative earnings report, the rush of business may substantially delay execution times.

The probable result is that you end up paying much more or selling for much less than you anticipated if you gave a market or stop order.

While choosing not to trade in a fast market is one way to reduce your risk, you might also protect yourself while seeking potential profit by giving your broker limit or stop-limit orders. That way, you have the possibility of buying or selling within a price range that's acceptable to you, but are less exposed to the frenzy of the marketplace.

The term fast market is also used to describe a marketplace -- typically an electronic one -- where trades are executed rapidly.