Cabinet Crowd

DEFINITION of 'Cabinet Crowd'

Members of the NYSE who typically trade in inactive bonds. The cabinet crowd is made up of a relatively small group of traders and investors who deal in inactive fixed-income securities. These bonds are inactive due to the fact that they are not actively traded and, thus, are deemed more illiquid, causing bid-ask spreads to be much wider than active or more liquid bonds.

Also known as the "inactive bond crowd" or "book crowd."

BREAKING DOWN 'Cabinet Crowd'

The name cabinet crowd arises from the fact that historically these members would typically enter limit orders for transacting these bonds, which were kept in "cabinets" adjacent to the bond trading floor until the limit prices were attained. Once these limit prices were reached, the orders would then be removed from said cabinets and executed.

RELATED TERMS
  1. Cabinet Security

    A security that is listed under a major financial exchange, such ...
  2. Active Bond Crowd

    The name given to members of the NYSE and their specific bond ...
  3. Bond Crowd

    A slang term used to describe members of the stock exchange that ...
  4. Bond

    A debt investment in which an investor loans money to an entity ...
  5. U.S. Savings Bonds

    A U.S. government savings bond that offers a fixed rate of interest ...
  6. Discount Bond

    A bond that is issued for less than its par (or face) value, ...
Related Articles
  1. Bonds & Fixed Income

    The Basics Of Bonds

    Bonds play an important part in your portfolio as you age; learning about them makes good financial sense.
  2. Home & Auto

    How To Choose The Right Bond For You

    Bond investing is a stable and low-risk way to diversify a portfolio. However, knowing which types of bonds are right for you is not always easy.
  3. Mutual Funds & ETFs

    Bond ETFs: A Viable Alternative

    Discover the advantages of a security that tracks bond index funds, but trades like a stock.
  4. Mutual Funds & ETFs

    Bond Funds Boost Income, Reduce Risk

    These funds can provide stable returns for those who depend on their investment income.
  5. Mutual Funds & ETFs

    Why Muni Bonds and Bond Funds are Perfect Together

    Municipal bonds and bond funds differ in several ways, which is partly why they complement each other well.
  6. Investing Basics

    The 4 Biggest Bond Myths

    Bonds can be a great addition to a portfolio but be aware of these four myths.
  7. Mutual Funds & ETFs

    Key Strategies To Avoid Negative Bond Returns

    It is difficult to make money in bonds in a rising rate environment, but there are ways to avoid losses.
  8. Investing

    Advising FAs: Explaining Bonds to a Client

    Most of us have borrowed money at some point in our lives, and just as people need money, so do companies and governments. Companies need funds to expand into new markets, while governments need ...
  9. Investing News

    Money Market vs. Short-Term Bonds: A Compare and Contrast Case Study

    Discover characteristics of money market and short-term bonds, including how the investments are alike and different, and the benefits and risks each offers.
  10. Stock Analysis

    A Fixed-Income Portfolio For The Masses

    The diversification benefits alone make bond ETFs one of the best investment vehicles for both institutional and retail investors.
RELATED FAQS
  1. What kinds of financial instruments are designated as “Securities” by Cabinet Order?

    Learn how the Japanese Financial Services Agency, or FSA, defines securities for Japanese stock markets and how the Cabinet ... Read Answer >>
  2. How does face value differ from the price of a bond?

    Discover how bonds are traded as investment securities and understand the various terms used in bond trading, including par ... Read Answer >>
  3. Which factors most influence fixed income securities?

    Learn about the main factors that impact the price of fixed income securities, and understand the various types of risk associated ... Read Answer >>
  4. Do long-term bonds have a greater interest rate risk than short-term bonds?

    The answer to this question lies in the fixed income nature of bonds and debentures, often referred to together simply as ... Read Answer >>
  5. Why is my bond worth less than face value?

    Find out how bonds can be issued or traded for less than their listed face values, and learn what causes bond prices to fluctuate ... Read Answer >>
  6. What causes a bond's price to rise?

    Learn about factors that influence the price of a bond, such as interest rate changes, credit rating, yield and overall market ... Read Answer >>
Hot Definitions
  1. Over-The-Counter - OTC

    Over-The-Counter (or OTC) is a security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, ...
  2. Quarter - Q1, Q2, Q3, Q4

    A three-month period on a financial calendar that acts as a basis for the reporting of earnings and the paying of dividends.
  3. Weighted Average Cost Of Capital - WACC

    Weighted average cost of capital (WACC) is a calculation of a firm's cost of capital in which each category of capital is ...
  4. Basis Point (BPS)

    A unit that is equal to 1/100th of 1%, and is used to denote the change in a financial instrument. The basis point is commonly ...
  5. Sharing Economy

    An economic model in which individuals are able to borrow or rent assets owned by someone else.
  6. Unlevered Beta

    A type of metric that compares the risk of an unlevered company to the risk of the market. The unlevered beta is the beta ...
Trading Center