Trading Securities Flashcards
What is the NYSE
private list of securities that meets certain critera
What is the OTC
Dealer to dealer unlisted securities
Exchanges are
auctions of securities
required to post best Bid (wholesale price) / ASK (retail price)
customer will always pay higher price
What is the NASDAQ
it is what autogenerates display quotes from Market Makers (BDs)
does not facilitate trades
What is the inside quote
The highest bid and lowest ask (best price to public)
A broker is also known as an
Agency
Earns commissions
Broker faciltates buyer/seller
A Dealer is also known as
Principal
Buy/Sell from inventory @ mark up
What is the Electronic Communication Network (ECN)
Offers trading “after hours”
Has volume and liquidity risk
What is the 4th market
When a client wants a security on the NYSE but BD can’t because they are not in the “club”, so they go find a BC who is and
What about specalized orders?
SL BS
__ CMV __
BL SS
- Do they own (sell) or want to (buy)
- What do they think the market will do?
What accelerates a bear market
a Sell Stop
What accelerates a bull market?
Buy stop
What is the FINRA 5% mark up policy?
Guidance around commissions (agency) and markups (principal)
What federal laws impact new issues
“33 Act in the primary market
