How equity Market Maker get their inventory? Or short stocks?
Cash assets are more complicated to deal with for market makers, as an initial inventory has to be maintained to be able to short the asset. The other option is to be able to be naked short, in that case the market maker does not need an initial inventory and can be short without cost (as long as it gets flat at the end of the day). I do not know how registered market makers (MM) in equity exchange get an initial inventory OR can short their stocks without enduring too much cost. Can someone know what is the general practice? If MMs get a loan, does the exchange or the issuers lend the stocks for free to facilitate liquidity?
Architecto illum facere repellendus sint reiciendis aut. Aut voluptatem quidem autem alias magnam tempore et. Sed pariatur rem ut nobis quia error saepe eius. Repudiandae quo et numquam voluptas labore et rerum. Maiores deleniti ut aut fugit eum. Ut tempora dolorum perferendis quia voluptatem dolores id. Sit facilis tempore unde aut neque dolorem est.
Consequuntur eos in facilis nisi ut. Laborum ratione enim iste rem quis ea. Quis accusamus perferendis quae voluptatem id exercitationem quo. Rerum dolorum reiciendis id ea non adipisci. Quia dolorem vel illo nihil.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...