Upstairs Market


DEFINITION of 'Upstairs Market'

The trading of securities, such as stocks, that occurs within a broker-dealer firm instead of at an exchange, such as a stock exchange, or between two broker-dealers in the over-the-counter (OTC) market. In an upstairs market transaction, the broker-dealer typically represents both parties (buyer and seller).

BREAKING DOWN 'Upstairs Market'

An upstairs market exists when trading occurs within a broker-dealer firm and not through a regular exchange such as a stock exchange. The Securities and Exchange Commission (SEC) prohibits this type of trading activity if the prices given to customers are less favorable than the prices available to customers in the general market.

  1. Broker-Dealer

    A person or firm in the business of buying and selling securities, ...
  2. Securities And Exchange Commission ...

    A government commission created by Congress to regulate the securities ...
  3. Over-The-Counter - OTC

    Over-The-Counter (or OTC) is a security traded in some context ...
  4. Full-Service Broker

    A broker that provides a large variety of services to its clients, ...
  5. National Association Of Securities ...

    The NASD was a self-regulatory organization of the securities ...
  6. Clowngrade

    An upgrade or downgrade of a security for reasons considered ...
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