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An individual or entity that stands ready to buy or sell financial instruments at all times. Market makers quote both a bid and an offer price to the market. Market makers provide liquidity to markets. They profit from the spread between bid and offer prices as well as from changes in market prices. Market makers adjust their bid or offer prices depending upon positions that they hold and/or upon their outlook for changes in prices. American Banker Glossary

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Used in the context of general equities. One who maintains firm bid and offer prices in a given security by standing ready to buy or sell round lots at publicly quoted prices. Bloomberg Financial Dictionary

See: agent, dealer, specialist. Bloomberg Financial Dictionary

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A firm or person with trading privileges on an exchange who has an obligation to buy when there is an excess of sell orders and to sell when there is an excess of buy orders. In the futures industry, this term is sometimes loosely used to refer to a floor trader or local who, in speculating for his own account, provides a market for commercial users of the market. Occasionally a futures exchange will compensate a person with exchange trading privileges to take on the obligations of a market maker to enhance liquidity in a newly listed or lightly traded futures contract. Chicago Mercantile Exchange Glossary

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A member of the Stock Exchange who has registered as such. There may be gilt ( gilts) edged market makers ( GEMMS) who are obliged to quote firm two-way prices ( i.e. guaranteed prices at which they will buy and sell) for all gilts. Alternatively they may be equity or fixed interest market makers who are only obliged to make firm two-way prices in stocks in which they are registered. Dresdner Kleinwort Wasserstein financial glossary

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Makes a market in one or more specific instruments. May frequently adjust or revise the published quote depending on market conditions but may be prohibited from withdrawing it. Will often function within an organised market, e.g. a stock exchange, in which case its quotes and trades are made within the context of the market's rules and membership criteria. To make a market in an instrument, a party must extend a continuous offer to buy or sell financial instruments with any qualified counterparty at a price quote published by the party, without respect to the identity of the qualified counterparty. Euroclear Clearing and Settlement glossary

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A market-maker is a person or firm authorised to create and maintain a market in a security. Market-makers commit themselves to always being ready to deal in the range of stocks for which they are registered. Exchange Handbook Glossary

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Dealers on the stock market who buy and sell stocks and shares on their own behalf to make a profit.

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Recognised financial institution or individual making buy and sell quotations in the secondary market. LIFFE

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A Securities firm which is obliged to offer to buy and sell securities in which it is registered throughout the mandatory quote period. London Stock Exchange Glossary

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A legal entity that trades for its own account. A market maker must at all times display bid and ask prices, for which minimum quantities and maximum spreads are defined instrument by instrument. A market maker must also meet minimum volume requirements in the contract( s) in which it makes a market. In return, market makers pay lower transaction fees. NYSE Euronext Glossary

   An individual or firm that stands ready to trade in one or more securities at quoted bid and ask prices. Market makers usually hold an inventory of the securities in which they make markets.