Financial Markets & Market Mechanics Financial Terms & Definitions

26 terms in this topic

Financial Markets & Market Mechanics encompasses the various platforms and systems where securities, currencies, and other financial instruments are bought and sold. It includes explanations of market types such as primary and secondary markets, exchange and over-the-counter trading, and key concepts like liquidity, order types, and price discovery. Understanding these mechanics is essential for grasping how asset prices are determined and how transactions are executed.

A

Ask

The ask (also called the ask price or offer price) is the lowest price a seller is willing to accept…

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B

Bid

The bid is the highest price a buyer is willing to pay for a security, such as a stock, bond,…

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B

Broker

A broker is an individual or firm that acts as an intermediary between buyers and sellers in financial markets. Instead…

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C

Custodian

A custodian is a financial institution that holds and safeguards a customer’s financial assets for safekeeping, to minimize the risk…

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D

Dark pool

A dark pool is a private electronic marketplace for trading securities, primarily stocks, that operates outside of public stock exchanges…

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D

Dealer

A dealer is a financial intermediary who buys and sells securities, such as stocks and bonds, for their own account.…

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E

Exchange

An exchange is a regulated marketplace where buyers and sellers come together to trade financial instruments such as stocks, bonds,…

Full Definition
Ask The ask (also called the ask price or offer price) is the lowest price a seller is willing… Bid The bid is the highest price a buyer is willing to pay for a security, such as a… Broker A broker is an individual or firm that acts as an intermediary between buyers and sellers in financial… Broker-dealer A broker-dealer is a financial firm or individual that engages in the buying and selling of securities for… Circuit breaker A circuit breaker is a regulatory mechanism used by stock exchanges to temporarily halt trading when a broad… Clearing house A clearing house (also known as a central counterparty or CCP) is a financial institution that acts as… Custodian A custodian is a financial institution that holds and safeguards a customer’s financial assets for safekeeping, to minimize… Dark pool A dark pool is a private electronic marketplace for trading securities, primarily stocks, that operates outside of public… Day order A day order is a type of order to buy or sell a security that is valid only… Dealer A dealer is a financial intermediary who buys and sells securities, such as stocks and bonds, for their… Exchange An exchange is a regulated marketplace where buyers and sellers come together to trade financial instruments such as… Good-til-cancelled (GTC) A Good-Til-Cancelled (GTC) order is a type of trading instruction that remains active in the market until it…