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M

arket makers provide 
an essential service: 
liquidity. The market 
maker is simply a firm 

that buys shares of that stock from anyone 
who is selling them and then sell shares 
of that stock to anyone who is buying. On 
the surface, that does not sound terribly 
important, but it is actually really essential. 
Market makers create a single focal point 
for a stock that allows everyone to execute 
their desired trades without necessarily 
having to search around to find someone 
to take the other side of the transaction. 
They are a conduit that facilitates quick, 
easy trading. The role of market makers 
has shifted over time, but their role as 
facilitators has helped make the stock 
market into something available and 
understandable to a wide swath of the 
population that might otherwise be too 

overwhelmed by the simple act of buying 
stock to even get started as investors. 
Globally, most exchanges operate via 
market makers. In Bangladesh the Market 
Maker Rule has been established since 
2000. However, no institution has so far 
shown any interest in becoming a market 
maker. The Bangladesh Securities and 
Exchange Commission has recently made 
some major amendments in the law to 
encourage participants to act as a market 
maker. Our Cover Story discusses the 
implications and prospects of market 
making in our country as well as globally.

Besides, the Technology section highlights 
the concept of ‘Hashgraph: Beyond 
Blockchain.’ Hashgraph is the emerging, 
non-blockchain distributed ledger 
technology. Hashgraph has been creating 
buzz in blockchain circles. In a few words, 
it is a technology that can offer many of the 

same solutions as blockchain, but which 
uses different mechanisms to transmit 
information and confirm transactions 
within the network. Hashgraph promises 
that it is “Fast”, “Secure”, and “Fair”. 
In our Special Article, Sourajit Aiyer, 
makes a comparison of Bangladesh 
Stock Exchange with its global peers. In 
addition to these, our regular contributors 
wrote their scholarly pieces.

Therefore, you are holding the 133

rd

 issue 

of Market Pulse.

Happy reading.

Happy investment.

SAR Md. Muinul Islam

Editor In-charge 
Publication Department 
LankaBangla Securities Limited

The Role of Market Makers in 

Exchanges

EDITORIAL