Designated Market Maker



Next video:
Loading the player...

A designated market maker, or DMM, maintains fair and orderly markets for an assigned set of listed firms. This also helps improve market liquidity. The New York Stock Exchange created this position in 2008 to offer better service than electronic-only platforms. The DMM is a point of contact for the listed company, and provides them with information such as trader sentiment and who has been trading the stock.

 

Related Articles
  1. Professionals

    THE DMM ACTING AS A PRINCIPAL

    The DMM Acting as a Principal In the absence of public orders the DMM is required to provide liquidity and price improvement for the stocks in which they are the designated market maker. DMMs ...
  2. Professionals

    The Role Of The Specialist / DMM

    The specialist is an independent exchange member who has been assigned a stock or group of stocks for which they are the designated market maker (DMM). They are responsible for: Maintaining a ...
  3. Professionals

    The Specialist / DMM Acting As A Principal

    In the absence of public orders the specialist / DMM is required to provide liquidity and price improvement for the stocks in which they specialize. Specialists/ DMMs are required to trade against ...
  4. Professionals

    The Specialist / DMM Acting As A Principal

    In the absence of public orders the specialist / DMM is required to provide liquidity and price improvement for the stocks in which they specialize. Specialists/ DMMs are required to trade against ...
  5. Professionals

    THE DMM ACTING AS AN AGENT

    The Acting As an Agent The DMM is also required to execute orders that have been left with them. Orders that have been left with the specialist for execution are said to be “left, or dropped, ...
  6. Professionals

    The Specialist / DMM Acting As An Agent

    The specialist / DMM is also required to execute orders that have been left with them. Orders that have been left with the specialist / DMM for execution are said to be “left or dropped ...
  7. Professionals

    B. The Exchanges

    The most recognized stock exchange in the world is the New York Stock Exchange or the NYSE. There are, however, many exchanges throughout the United States that all operate in a similar manner. ...
  8. Professionals

    Stopping Stock

    A specialist, as a courtesy to a public customer, may guarantee an execution price while trying to find an improved or better price for the public customer. This is known as “stopping stock” ...
  9. Professionals

    STOPPING STOCK

    Stopping Stock A DMM, as a courtesy to a public customer, may guarantee an execution price while trying to find an improved or better price for the public customer. This is known as “stopping ...
  10. Professionals

    The Specialist / DMM Acting As An Agent

    The specialist / DMM is also required to execute orders that have been left with them. Orders that have been left with the specialist / DMM for execution are said to be “left or dropped ...

You May Also Like

Hot Definitions
  1. Goodwill

    An account that can be found in the assets portion of a company's balance sheet. Goodwill can often arise when one company ...
  2. Return On Invested Capital - ROIC

    A calculation used to assess a company's efficiency at allocating the capital under its control to profitable investments. ...
  3. Law Of Demand

    A microeconomic law that states that, all other factors being equal, as the price of a good or service increases, consumer ...
  4. Cost Of Debt

    The effective rate that a company pays on its current debt. This can be measured in either before- or after-tax returns; ...
  5. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  6. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
Trading Center