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The amount subtracted from the selling price of securities when they are sold to a dealer in the OTC market. Also, the discounted price of municipal bonds after the market has shown little interest in the issue at the original price.


1. The amount by which a seller reduces a price for a product or asset in order to make it desirable for buyers. See also: Markup.

2. The difference between the price a broker-dealer charges for a retailer to buy a security and the price at which the broker-dealer sells the same security to a market maker. This may or may not be considered a commission.


1. A decrease in a security price made by a dealer because of changing market conditions. For example, a bond trader may take a markdown in long-term bonds held in inventory when market interest rates rise. Compare markup.
2. The difference between the price paid by a dealer to a retail customer and the price at which the dealer can sell the same security to a market maker. Compare markup.


A markdown is the amount a broker-dealer earns on the sale of a fixed-income security and is the difference between the sales price and what the seller realizes on the sale.

The markdown may or may not appear in the commission column or be stated separately on a confirmation statement.

A markdown is determined, in part, by the demand for the security in the marketplace. A broker-dealer may charge a smaller markdown if the security can be resold at a favorable markup.

The term markdown also refers more generally to a reduced price on assets that a seller wants to unload and will sell at less than the original offering price.

References in periodicals archive ?
In addition, the proposed regulations clarify that neither the cost complement nor ending retail selling prices should be adjusted for temporary markdowns and markups.
According to FINRA, the banking company had, charged excessive corporate and agency bond mark-ups and markdowns from July 2007 to September 2010.
As we continue to grow our business, markdown optimization is critical," said Robert Glass, President and Chief Operating Officer of Loehmann's Inc.
However, post-Christmas markdowns were lower than last year - the average was 52 per cent off compared with 55 per cent.
Regardless of your decision, high-quality broker-dealer partnerships are important, and here's why: A firm must create enough purchasing power to buy and sell bonds with minimal markups and markdowns.
During the fall [1999] season, the company began the implementation of an enhanced markdown strategy that accelerated markdowns and shortens merchandise cycles," Bull wrote in a March 21, 2000 release.
So far, the markdown strategy has been even more successful than Corel expected.
To gauge the efficiency of markdown administration, spot checks should be done in the field.
As a result of the implementation, Body Central is now able to complete markdowns in 50% less time than with the manual method.
As an alternative, the IRS stated that the retail-inventory method could achieve the same result by permitting taxpayers to reduce the numerator (the cost of beginning inventory and the cost of purchases) of the cost-to-retail ratio for all non-sales- based allowances, discounts, or price rebates, including markdown allowances, but requiring a reduction of the denominator (the retail selling price of beginning inventory plus the retail selling price of purchases) of the cost-to-retail ratio for all permanent markdowns related to mark-down allowances.
With three decades of expertise in forecasting, scalable algorithm development, pattern recognition, neural networks and other artificial intelligence, our technologies enable customers to boost revenue, minimize markdowns and improve profitability.
However, the spread of markdown levels is now greater than ever before - markdowns as shallow as ten per cent and as deep as 80 per cent were seen.