Business and Personal Finance Dictionary

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• SPECIALIST MARKET-MAKER
  
  A New York Mercantile Exchange-sponsored pro-gram under which a designated trader provides liquidity in a new or stagnant market by facilitating any trade within an established bid/ask spread and accepting all limit orders it is requested to execute. In return for the specialist market maker’s commitment and to compensate for the risk it will incur, the market’s proprietary account gets priority of execution in a certain percentage of the trades in the market, and the Exchange pays it an execution fee for every outside order it fills, as well as helping to offset some of its direct floor operation costs. The function of the specialist market maker lasts until average daily volume and open interest in the contract reaches a predetermined level.
  
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