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INTERVIEW

MARKET MAKER

Dr. Mohammad Musa

 

Professor
School of Business and Economics
United International University (UIU)

What is the concept of ‘market 
making?’ Who can be a market maker 
in the Bangladesh capital market?

In New York Stock Exchange (NYSE) 
and any other standard stock exchanges 
the market makers are termed as 
specialists. Market makers always take 
the responsibility of the securities to 
make the market. If any investor wants to 
buy or sell any share in the market, they 
will either need a buyer or an immediate 

seller. In some cases, we notice that 
there are buyers in the market, but no 
seller resulting in no transaction taking 
place. Similarly, there are sellers with 
no buyer to make the transactions.  In 
such situations the market is not created. 
However, in presence of a specialist, it is 
the responsibility of the market maker to 
make that transaction. It is the duty of the 
specialist to post bid and ask prices for the 
securities they are specializing. The price 
at which the specialist is ready to buy is 

Market makers always 
take the responsibility of 
the securities to make the 
market. If any investor 
wants to buy or sell any 
share in the market, they 
will either need a buyer 
or an immediate seller.