中文

Market maker mode

Time:[2017-12-21 15:14:41]

Characteristics of the OTC

1、improve liquidity of exchange object funds, increase market's attractiveness to investors and investment firms;

Such as spot gold trading by retail investors is relatively high of risk, the enthusiasm of investors and investment firms involved in greater impact. Have market makers, they assume the needed funding for market makers, they can be traded at any time, an active market. Buyers and sellers do not have to wait for the other, as long as market makers came forward, assume the responsibilities of the other, transactions can be do it. Therefore, market makers ensure uninterrupted trading activity in the market, even at the bottom of the market as well.


2、effectively stabilizing the market, promoting the market balance operation;

Market makers are responsible for participation in the commodity price rises and falls, which helps to curb excessive speculation, to the market of "stabilizers" role. In addition, the competition between market makers a great extent to guarantee the stability of the market.


3、have price discovery function.

Market maker prices are all participants in the comprehensive analysis of market information to measure its risks and benefits on the basis of the formation, and investors in the quotations on the basis of decisions and in turn, affect the quotation of market makers, prompting stock prices move closer to its real value.


Market maker requirement

Because of market-maker system with the above features as well as regulating the sale of imbalances, guarantee sale of two-way price features at any time, determines the capabilities of the condition that has a high quality of market makers. More stringent market-making choices, only the standard operating and capital strength, familiar with the operation and risk control ability of the business to perform.


In General, the market maker must possess the following qualifications:
1.With strong financial strength, so as to build up enough inventory to satisfy the trading needs of investors;
2.With the ability to manage inventory, so as to reduce the risk of product inventory;
3.Have accurate quote ability, to be familiar with their products, and have strong analytical skills;


Mature financial market

Market-making system has been widely used in many mature securities market, such as the United States is the most successful example of the NASDAQ system. Market-making transactions in the over-the-counter market mostly bonds and unlisted stocks, NASDAQ system is spread over more than 6,000 across the country associated with multiple market makers, rapid delivery in trading of nearly 7000 stocks and bonds for buyers and sellers, providing a unified clearing and monitoring, in addition to preparation of the stock price index. On average, the NASDAQ market have 12 market marker for each stock. In this way, problems of asymmetric information market will be greatly eased, and individual institutional investors hardly through market manipulation and profiteering, the speculative nature of the market significantly reduced, and reduced the traditional phenomenon of so-called market makers secretly manipulating stock prices.


Famous market maker

MLCO     Merrill Lynch Inc. (In September 2008 by United States banks)
MSCO     Morgan Stanley & Co. Inc.
SALB     Salomon Brothers
HRZG     Herzog, Heine, Geduld, Inc.
MASH     Mayer & Schweitzer, Inc.
SLKC     Spear, Leeds & Kellogg Capital Markets
NITE      Knight Trading Group, Inc.

In addition, as we all know, the world's largest gold market in the United Kingdom, London, London gold market was not familiar to Chinese investors Exchange Broker auction Center. London gold market is a cover market made up of many gold market maker, is the world's largest gold trading market, determine the world market price of gold.

N M Rothschild & Sons Limited

Deutsche bank

Bank of Nova Scotia-Scotia Mocatta

HSBC USX