registered competitive market maker

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Registered competitive market maker

An NASD-registered dealer who acts as a market maker for a designated over-the-counter stock by buying and selling that stock to maintain stability.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Registered Competitive Market Maker

1. A market maker registered with the National Association of Securities Dealers. As market makers, they seek to maintain stable prices by offering consistent buy and sell prices on over-the-counter trades. They list their bid and ask quotes on NASDAQ, which requires at least two registered competitive market makers per listed stock. Their bid and ask quotes are compared to ensure a representative spread.

2. See: Registered competitive trader. An independent member of the New York Stock Exchange, who does not represent a firm and who acts as his/her own broker. Registered competitive traders are expected to correct imbalances of orders. Because they do not pay commissions, they deal actively in stocks, but because they represent only themselves they account for less than 1% of trade volume. Orders from specialists take precedence over registered competitive traders. See also: Registered equity market maker.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

registered competitive market maker

1. A dealer registered with the National Association of Securities Dealers to make a market in one or more securities. A registered competitive market maker must give the market firm bid and ask prices.
2. A floor trader on the New York Stock Exchange.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
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