A specialist is assigned to each security traded on the exchange. When a market order has no matching counteroffer, the specialist makes a market by trading against the order if necessary for his own account. In the case of market orders, the specialist buys at the bid price and sells at the ask price. He makes a profit on the bid ask spread.
Increasingly bid/ask orders are being matched electronically. The specialist still pays a key role on certain exchanges, especially the New York Stock Exchange.
Related Fool Articles
- [link link title]
Recent Mentions on Fool.com
- Raytheon Company Reports Earnings: Why I Own It -- and Why I Regret It
- 5 Things Citrix Systems, Inc. Management Wants You to Know
- Sherwin-Williams Co Paints a Prettier Picture for 2015
- Here's How Citrix Systems, Inc. Just Beat Earnings Expectations
- GoPro Inc Teams Up With the NHL -- What Does This Mean for Investors?
- The Hidden Behemoth Helping Power the Smartwatch Revolution