Write Out

AAA

DEFINITION of 'Write Out'

A dual trade transaction enacted by a specialist in an individual stock issue. The first trade in a write out will be between the specialist and a floor trader, using the specialist's own inventory of stock, which is sold to the trader. The trader then executes the second part of the trade by transacting the same number of shares with an end client or firm.

INVESTOPEDIA EXPLAINS 'Write Out'

Specialists are given daily inventories of stock to use as they see fit to maintain an orderly market in the stocks in which they make markets. By stepping in to purchase or sell shares as needed, they can ensure a smooth and orderly market, even during rocky trading days. The advent of electronic trading platforms has limited the need for specialists and write outs, but so far, machines have not completely erased the need for people on the trading floor.

RELATED TERMS
  1. Market Maker

    A broker-dealer firm that accepts the risk of holding a certain ...
  2. Order

    An investor's instructions to a broker or brokerage firm to purchase ...
  3. Orderly Market

    Any market in which the supply and demand are reasonably equal. ...
  4. New York Stock Exchange - NYSE

    A stock exchange based in New York City, which is considered ...
  5. Specialist

    A member of an exchange who acts as the market maker to facilitate ...
  6. Working Capital

    This ratio indicates whether a company has enough short term ...
Related Articles
  1. The NYSE And Nasdaq: How They Work
    Options & Futures

    The NYSE And Nasdaq: How They Work

  2. What's the difference between a Nasdaq ...
    Brokers

    What's the difference between a Nasdaq ...

  3. Who employs the specialists at New York ...
    Investing

    Who employs the specialists at New York ...

  4. What are the determinants of a stock's ...
    Investing

    What are the determinants of a stock's ...

comments powered by Disqus
Hot Definitions
  1. Last In, First Out - LIFO

    An asset-management and valuation method that assumes that assets produced or acquired last are the ones that are used, sold ...
  2. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  3. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  4. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  5. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  6. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
Trading Center