DEFINITION of 'Firm Quote'

A price quote on a security, made by a dealer or market maker, that guarantees a bid or ask price up to the amount quoted. This differs from a nominal quote wherein the price and quantity of a bid or ask quote are not firmly posted.

BREAKING DOWN 'Firm Quote'

For example, if a market maker posts a bid firm price quote of $25 @ 10K, this tells other dealers and investors that this market maker will buy up to 10,000 shares for a price of $25. If the quote were to be nominal, then the seller of the security could try to negotiate for a better price and the market maker might move on its price - for example, being willing to purchase for $25.75.

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RELATED FAQS
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    The difference between these two market systems lies in what is displayed in the market in terms of orders and bid and ask ... Read Answer >>
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    Yes, you are correct that the ask price of a security should typically be higher than the bid price. This is because people ... Read Answer >>
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    Learn what the bid and ask prices mean in a stock quote. Find out what represents supply and demand in the stock market and ... Read Answer >>
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