Fourth Market
Definition of 'Fourth Market'The trading of exchange-listed securities between institutions on a private over-the-counter computer network, rather than over a recognized exchange such as the New York Stock Exchange (NYSE) or Nasdaq. Trades between institutions will often be made in large blocks and without a broker, allowing the institutions to avoid brokerage fees. |
|
Investopedia explains 'Fourth Market'For example, when a mutual fund and a pension fund enter into a large block trade with each other, this would generally occur in the fourth market and usually over an electronic communication network. By executing the transaction this way, both parties avoid brokerage and exchange transaction fees. They also avoid the possibility of distorting the market price or the volume traded on an exchange. |
Related Definitions
Articles Of Interest
-
A Look At Primary And Secondary Markets
Knowing how the primary and secondary markets work is key to understanding how stocks trade. -
Getting To Know The Stock Exchanges
Here are the answers to all the questions you have about stock exchanges but are too afraid to ask! -
The Hidden Fees In 401(k)s
Learn about the conspicuously disclosed fees that lurk within your 401(k) investments. -
Choose A Fund With A Winning Manager
We break down the key components of analyzing a fund manager's performance so you can find a winner. -
Analyzing The Best Retirement Plans And Investment Options
Understanding the various retirement investments - from annuities to 401(k)s and everything in between - is crucial to reaching your retirement goals. Here, we examined many of the popular investments ... -
Women: Invest In Your Financial Literacy
Learning about money may seem intimidating, but it's not as hard as it looks. -
4 Behavioral Biases And How To Avoid Them
Here are four common common behavioral biases for traders and how to minimize their effects on your portoflio. -
The NYSE And Nasdaq: How They Work
Learn some of the important differences in the way these exchanges operate and the securities that trade on them. -
Mutual Fund Ratings: Crucial or Insignificant?
Mutual fund ratings can help investors, but they have their drawbacks as well. -
Multi-Asset Funds Or Your Own Mix?
The underlying concept of mixed funds is very appealing. Discover if you're better off with professional management or creating a mixed fund of your own.
Free Annual Reports