locked market

Locked Market

A short-term situation occurring within a market where both the bid and ask are identical, resulting in no bid-ask spread.

Notes:

This usually occurs in stocks that are highly volatile and experience a significant trading volume. Locked markets are typically corrected immediately through subsequent trades. This abnormal market condition occurs mainly on the Nasdaq exchange for orders entered before the opening bell.

See also: Ask, Bid, Bid-Ask Spread, Crossed Market, Nasdaq, Spread

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Locked market

A market is locked if the bid price equals the ask price. This can occur, for example, if the market is brokered and one side pays brokerage only, in over-the-counter trading the initiator of the transactions. Highly competitive market environment with inside bid and offering at the same price. Often occurs when an OTC dealer has not updated the market.

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locked market

A somewhat unusual occurrence in which the bid price and ask price for a security are equal.