Itayose

AAA

DEFINITION of 'Itayose'

A clearing method used by Japanese commodity exchanges to set prices. It is a form of auction market in which the time of order entry is not distinguished, and an opening price is derived on the principle of price priority requiring that the following occurs:

1. All market orders are executed first.
2. Next, all limit orders are executed to sell/buy at prices lower/higher than the execution price.
3. Finally, the following amounts of limit orders to sell or buy are at the execution price:
- the entire amount of all either sell or buy orders, and
- at least one trading unit from the opposite side of the order book.


INVESTOPEDIA EXPLAINS 'Itayose'

This is a modified version of the Walrasian market. Staff at exchanges that implement the itayose method will post a provisional price to floor members. These members then submit buy and sell orders to the staff, who subsequently analyze the orders to adjust the provisional price. This process is repeated until a price matches all the buy and sell orders placed by the floor members, clearing all trades.

RELATED TERMS
  1. Limit Order

    An order placed with a brokerage to buy or sell a set number ...
  2. Walrasian Market

    An economic model of a market process in which orders are collected ...
  3. Commodity

    1. A basic good used in commerce that is interchangeable with ...
  4. Exchange

    A marketplace in which securities, commodities, derivatives and ...
  5. Auction Market

    A market in which buyers enter competitive bids and sellers enter ...
  6. Batch Trading

    An accumulation of orders that are executed simultaneously. Batch ...
Related Articles
  1. Principal Trading and Agency Trading
    Investing Basics

    Principal Trading and Agency Trading

  2. Getting To Know The Stock Exchanges
    Options & Futures

    Getting To Know The Stock Exchanges

  3. Understanding Order Execution
    Investing Basics

    Understanding Order Execution

  4. Futures Fundamentals
    Insurance

    Futures Fundamentals

Hot Definitions
  1. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  2. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
  3. Wage-Price Spiral

    A macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. ...
  4. Accelerated Depreciation

    Any method of depreciation used for accounting or income tax purposes that allows greater deductions in the earlier years ...
  5. Call Risk

    The risk, faced by a holder of a callable bond, that a bond issuer will take advantage of the callable bond feature and redeem ...
  6. Parity Price

    When the price of an asset is directly linked to another price. Examples of parity price are: 1. Convertibles - the price ...
Trading Center