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Finance: What is an Auction Market? 13 Views


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Description:

What is an Auction Market? Auction markets are the common stock exchanges. They allow buyers and sellers to enter bids and offers; trades occur when the highest price a buyer will pay or the lowest price a seller will take is reached.

Language:
English Language

Transcript

00:00

Finance a la shmoop... what is an auction market.. next up on the block [Man speaking on stage]

00:07

we've got stock in the company comb Depot....

00:18

okay yeah so the New York

00:20

Stock Exchange is an auction market and you have no idea how much caffeine I had [Man holding a monster energy drink]

00:24

to have to get that right which means that the prices on the new york stock

00:28

exchange happen during a bidding process we're matching offers get you know [People frantically rushing to bid for stocks]

00:34

matched... buyers and sellers buy and sell at the

00:40

same time so in essence two transactions are happening at once the opposite of

00:45

this sort of market is the over the counter or OTC market where dealers are

00:50

the ones holding all the cards and they ultimately determine the price by [Dealer with the cards]

00:54

creating a spread from where they're willing to sell your shares and what

00:58

price they'll pay to buy your shares but in an OTC market well you don't get to [Dogs running side by side]

01:03

feel like you're watching the last leg of a greyhound race so you don't get all

01:06

my caffeinated auction talk there which is kind of cool we like that, right..right?

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