Per investopedia:
A market maker is a "market participant" or member firm of an exchange that also buys and sells securities at prices it displays in an exchange’s trading system for its own account which are called principal trades and for customer accounts which are called agency trades. Using these systems, a market maker can enter and adjust quotes to buy or sell, enter, and execute orders, and clear those orders.
I know a member firm is an SRO and member of at least one major stock exchange, but what exactly does it mean to display prices in an exchange for people to buy/sell? Do they basically decide how much a stock is worth? And what are the differences between its own account (in regards to principal trades) and customer accounts (agency trades).
Basically do market makers have complete control over how much each stock is worth?
Submitted June 03, 2018 at 12:01PM by KingShindo https://ift.tt/2JgyMAs
