The work of the Stock Exchange

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Monograph

Identifikator:: 1831284952

URN:: urn:nbn:de:zbw-retromon-225876

Document type:: Monograph

Author:: Meeker, James Edward http://d-nb.info/gnd/126597340

Title:: The work of the Stock Exchange

Edition:: Revised edition

Place of publication:: New York

Publisher:: The Ronald Press Company

Year of publication:: [1930]

Scope:: XVI, 720 Seiten; Illustrationen, Diagramme

Digitisation:: 2022

Collection:: Economics Books

Usage license:: Get license information via the feedback formular.

Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: Chapter VIII. The floor trader and the specialist

Collection:: Economics Books

THE FLOOR TRADER AND THE SPECIALIST 211 The majority of specialists act as dealers in much the same way as the floor traders do, and speculate for small, quick profits. In this buying and selling of securities with other Exchange members for their own account, the specialists per- form many of the functions of the “jobbers” in the London Stock Exchange. Far from there being any reasonable ground to object to this trading by the specialist, in reality the practice constitutes one of his most useful functions in the Exchange and renders the same general economic service that the more scattered transactions of the floor trader do. For, if the spe- cialist refused to engage in speculative dealings on his own account, there often might not be sufficient orders for stocks, either in his book or with other members of the crowd, to make a close market for them. The Exchange insists, however, that when the specialist does trade for himself, he must not pretend to be executing orders as a broker.’ The specialist is, there- fore, forbidden in any transaction to charge a commission as a broker and at the same time make a profit as a dealer. Precedence of Customers’ Orders.—Furthermore, the specialist is compelled to give precedence to his customers’ orders for the purchase or sale of securities, over the orders which originate with himself as a dealer, granting always that both his and his customers’ orders are either market orders or else limited at the same price. If, for example, a specialist has a customer's order to buy 100 Reading at 735, and at the same time wishes to purchase the same amount of the same stock at the same price, he must execute the customer’s order before buying his own stock. But if the specialist is willing to pay 75% or 75%; for the 100 Reading, he can, of course, do so first. Similarly, if the customer's order is for the sale of 100 Union Pacific at 180, the specialist can sell 100 Union at 17974 or 17934 for himself, but cannot sell his own stock at 180 till he has executed his customer’s order. With market orders the customer’s order always has precedence. "See Chapter III, p. 83, and Appendix VIIId.

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