Quote Rule

Categories: Trading, Regulations

It's a stock market thing. And it exists as an exchange rule.

Think: something from NASDAQ, the NYSE, and its brethren. It requires market makers to be fully disclosative of stock price quotations for any listed security, when that set of offers represents more than one percent of the aggregate trading volume of that security.

Why does this rule exist? Because if a large transaction is in the process of happening, like a founder dumping her shares, or an LBO artist coming in to take over the company, that information is directly applicable and relevant to current and potential owners of the security. They have a right to know about the freight train heading at them, or leaving the station, and so the quote rule ended up being a Thing.

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Finance: What is a Firm Deal: Commit, Qu...4 Views

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Finance allah shmoop What are a firm deal Ah firm

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commit and a firm quote No a lot of firms

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here is by agra involved in this one No Well

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okay people Yes You knew we were going to go

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there We'll start with firm commit Well the whole notion

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of a firm commit applies on a few fronts Like

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if a lender is lending dough Well usually there is

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a contractual agreement cleverly called a firm commitment letter and

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it derives a firm deal like the deal will follow

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that commitment And that letter specifies the amount of money

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the lender is willing to lend at a given interest

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rate With all the terms you know spelled out for

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given time like this offer is good for thirty days

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or until june first Or until the where wolf grows

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What they crow Don't they Okay howl whatever In an

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ai po when a bank is selling shares on behalf

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of a company issuing them a firm commit gives rise

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to a firm deal And it basically says that the

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bank is responsible for selling any unsold shares That is

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It's called a quote bought deal unquote And the bank

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Either sells those aipo shares to investors or well they

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buy them for their own account In a firm quote

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the commitment involved usually refers to a broker dealers bid

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ask spread in selling those shares like she holds a

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few million shares of amazon in inventory and publishes to

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her constituency that she is firm as a buyer at

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eleven hundred two and twenty and a seller at eleven

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hundred eight and fifty Got it sets one one zero

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two point two zero in a cellar at one one

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zero eight point five oh yeah that's how it would

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look well if anyone matches those numbers then she is

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legally obligated to sell them And just in case someone

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wants to buy a good gillian shares i am or

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than she carries in inventory well there's usually a limit

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number attached to her offer for like i stand firm

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on one hundred thousand at this price like a hundred

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thousand shares and not a hundred thousand won something like

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that anyway so firm think obligated confirmed contracted for legally

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binding and sometimes yeah that'll give you cramps Just try 00:02:17.1 --> [endTime] prunes

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