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On an exchange, the member firm that is designated as the market maker (or dealer for a listed common stock). Member of a stock exchange who maintains a "fair and orderly market" in one or more securities. Only one specialist can be designated for a given stock, but dealers may be specialists for several stocks. In contrast, there can be multiple market makers in the OTC market. Major functions include executing limit orders on behalf of other exchange members for a portion of the floor broker's commission, and buying or selling for the specialist's own account to counteract temporary imbalances in supply and demand and thus prevent wide swings in stock prices.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.


A member firm on a securities exchange that the exchange's management charges with keeping a fair and orderly market on one or more securities. That is, a specialist serves as a market maker on its assigned securities by buying and selling them to ensure liquidity in the market. Brokers approach specialists to conduct to conduct transactions on their assigned securities. Each security on the exchange has exactly one specialist. A specialist is less commonly called an assigned dealer. See also: Book.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved


A member of a securities exchange who is a market maker in one or more securities listed on the exchange. The specialist is the person on the exchange floor to whom other members go when they wish to transact or leave an order. Specialists are assigned securities by the exchange and are expected to maintain a fair and orderly market in them. Also called assigned dealer. See also book, Rule 104.
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.


A specialist or specialist unit is a member of a securities exchange responsible for maintaining a fair and orderly market in a specific security or securities on the exchange floor.

Specialists execute market orders given to them by other members of the exchange known as floor brokers or sent to their post through an electronic routing system.

Typically, a specialist acts both as agent and principal. As agent, the specialist handles limit orders for floor brokers in exchange for a portion of their commission.

Those orders are maintained in an electronic record known as the limit order book, or specialist's book, until the stock is trading at the acceptable price. As principal, the specialist buys for his or her own account to help maintain a stable market in a security.

For example, if the spread, or difference, between the bid and ask, or the highest price offered by a buyer and the lowest price asked by a seller, gets too wide, and trading in the security hits a lull, the specialist might buy, sell, or sell short shares to narrow the spread and stimulate trading.

But because of restrictions the exchange puts on trading, a specialist is not permitted to buy a security when there is an unexecuted order for the same security at the same price in the limit order book.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.
References in periodicals archive ?
This has led to fears schools, including several in our area, will lose their specialisms.
FIREARMS Dog: Ska Breed: German Shepherd with Czech bloodline Specialism: Firearms enhanced dog Age: Four Service: Two-and-a-half years About: Ska is the brother of police dog Stig who was stabbed in the face with a pair of scissors as he tried to help detain a man acting violently in front of police officers during an incident in Stirchley last month.
"Our specialism is enterprise as well as engineering and being entrepreneurial and working as a team was just as important as creating the end product."
"This academy will be unique combining business and enterprise specialisms and supported by both the Catholic Archdiocese and Church of England Diocese as well as the business community.
Kay Murray, school specialism leader for health, added: "As Milburn is Excelsior's health school, it felt like a natural fit for us to fundraise for Sport Relief.
As a recognised high performing 11-18 college, Bellerive has the unusual status of having been awarded three specialisms.
"Our academy's specialism is business and enterprise and the experience the students have had in creating this garden is at the heart of that specialism.
Through the arts specialism the school is aiming to raise standards by introducing creativity into the lessons.
Ms Gilbert said: "Across a range of subjects, inspectors reported that they visited some schools where there was little to suggest that specialism had made a difference in terms of the fundamentals of classroom teaching.
Each pupil at the schools will receive pounds 129 extra funding each year for four years, and the schools will get a pounds 100,000 grant for new facilities for their specialism.
No5 Chambers has been developing a specialism in financial services which is positioned to work with the ever-changing financial markets.