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Normal Market Size

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Normal Market Size (NMS)
A system that categorizes the size of transactions that are normal for a particular security and forces market makers to deal within these sizes.

Normal Market Size
The number of shares in a publicly-traded company that can be traded at a given price. The normal market size is a set number determined by the stock's market capitalization. Market makers must trade within the parameters of the normal market size. If a market maker wants to buy or sell more shares than the normal market size, he/she must negotiate a new price. The normal market size exists to keep particularly large orders from affecting the share price, thus reducing volatility.


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