What is 'Direct Market Access - DMA'

This refers to electronic facilities, often supplied by independent firms, that allow buy side firms to access liquidity for securities they may wish to buy or sell. Buy side firms are customers of sell side firms - brokerages and banks which may act as market makers in a security. Buy side firms will still use the trading infrastructure of sell side firms, but have more control over how the trade is executed.

BREAKING DOWN 'Direct Market Access - DMA'

Direct market access allows buy side firms to often execute trades with lower costs. Since it is all electronic, there is less chance of trading errors. Order execution is extremely fast, so traders are better able to take advantage of very short-lived trading opportunities.

RELATED TERMS
  1. Sell Side

    The part of the financial industry involved with the creation, ...
  2. Firm Order

    1. A market order to buy or sell a security for a brokerage's ...
  3. Buy, Strip And Flip

    When a private equity firm buys out a target firm (usually with ...
  4. Payment For Order Flow

    The compensation and benefit a brokerage receives by directing ...
  5. Market Maker

    A broker-dealer firm that accepts the risk of holding a certain ...
  6. Middle Market Firm

    A firm with sizeable annual revenues, ranging from $50 million ...
Related Articles
  1. Investing

    Wall Street's Sell Side

    The sell side of the financial industry creates, promotes, analyzes and sells securities.
  2. Small Business

    What is a Firm?

    A firm is a business or organization that sells goods or services on a for-profit basis.
  3. Investing

    Role Of A Market Maker

    A market maker is a firm or an individual that stands ready to buy and sell a particular security throughout the trading session to maintain liquidity and a fair and orderly market in that security. ...
  4. Insurance

    Brokerage Functions: Underwriting And Agency Roles

    Learning about these various activities can give insight into how securities are issued and traded.
  5. Investing

    Stock Analysts: Should You Listen?

    If you want to find out which analysts are worth following, you shouldn't take their word for it.
  6. Trading

    Top 10 Brokerage Firms For Day Trading

    Day traders have different needs from long-term investors. Investopedia rates the top 10 brokerage firms for day traders.
  7. Personal Finance

    Financial Career Shift: Get In The Driver's Seat

    Before you agree to work for another investment firm, be sure you know what you're getting into.
  8. Insurance

    A Primer On Private Equity

    Private equity investing is becoming more accessible for individual investors; find out how you can get involved.
  9. Small Business

    Tips For Fitting In At Your Brokerage Firm

    Part of starting a successful career as a broker is finding the right place to work.
  10. Trading

    Basics Of The Mechanics Behind Electronic Trading

    What was once associated with shouting traders and wild hand gestures has now become more closely associated with statisticians and computer programmers.
RELATED FAQS
  1. How do financial advisors execute trades?

    Understand how financial advisors normally execute an investor's trades. Learn about the different type of markets and exchanges ... Read Answer >>
  2. Why are most brokerage firms owned by banks?

    Learn about the differences between investing with a bank-owned brokerage firm or with an independent broker. Get real answers ... Read Answer >>
  3. What is the difference between private equity and venture capital?

    Learn the differences between private equity and venture capital, especially in terms of how these types of firms invest ... Read Answer >>
  4. What are the key barriers to entry for companies in the electronics sector?

    Learn how the entry barriers of economies of scale and scope, research and development, capital and brand loyalty affect ... Read Answer >>
  5. Can you short sell stocks that are trading below $5? My broker says that I can't.

    Short selling can be very risky for both the investor and the broker. Brokers will often tell investors that only stocks ... Read Answer >>
Hot Definitions
  1. Graduate Record Examination - GRE

    A standardized exam used to measure one's aptitude for abstract thinking in the areas of analytical writing, mathematics ...
  2. Graduate Management Admission Test - GMAT

    A standardized test intended to measure a test taker's aptitude in mathematics and the English language. The GMAT is most ...
  3. Magna Cum Laude

    An academic level of distinction used by educational institutions to signify an academic degree which was received "with ...
  4. Cover Letter

    A written document submitted with a job application explaining the applicant's credentials and interest in the open position. ...
  5. 403(b) Plan

    A retirement plan for certain employees of public schools, tax-exempt organizations and certain ministers. Generally, retirement ...
  6. Master Of Business Administration - MBA

    A graduate degree achieved at a university or college that provides theoretical and practical training to help graduates ...
Trading Center