Indicative Quote

DEFINITION of 'Indicative Quote'

In forex trading, a currency quote that is provided by a market maker to a trading party but that is not firm. In other words, when a market maker provides an indicative quote to a trader, the market maker is not obligated to trade the given currency pair at the price or the quantity stated in the quote. Contrast this to a firm quote, in which a market maker guarantees a specified bid or ask price to a trader up to the maximum quantity specified in the quote.

BREAKING DOWN 'Indicative Quote'

Market makers will typically provide indicative quotes if a trader requests a quote for a currency pair but does not specify the quantity to be traded, or if there is some doubt as to the market maker's ability to transact the currency pair at the bid or ask quoted. The bottom line is that traders can rely on indicative quotes as a reasonable estimate of the exchange rate at which they can enter their currency trade, but there is no guarantee that this will be the rate they get.

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RELATED FAQS
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    When reading currency quotes, you have probably noticed that there is only a single quote for a pair of currencies. Currency ... Read Answer >>
  2. How is spread calculated when trading in the forex market?

    First, remember that in the forex markets investors trade one currency for another. Therefore, currencies are quoted in terms ... Read Answer >>
  3. Why isn't the EUR/USD currency pair quoted as USD/EUR?

    In a currency pair, the first currency in the pair is called the base currency and the second is called the quote currency. ... Read Answer >>
  4. What is the difference between a quote driven market and an order driven one?

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