marknadsgivande

Marknadsgivande, also known as market-making, is a financial practice where a market maker provides liquidity to a financial instrument by acting as a buyer and seller. This is typically done to ensure that there is always a market for the instrument, even when there are no other willing participants. Market makers are often institutions or individuals that hold large positions in the underlying asset, allowing them to absorb or add to the supply without significantly affecting the market price.

Market-making can take various forms, including providing quotes for stocks, options, futures, and other derivatives. These quotes are bid and ask prices, representing the market maker's willingness to buy or sell the instrument at a specific price. The market maker's profit comes from the spread between the bid and ask prices, known as the bid-ask spread.

Market-making is crucial for maintaining efficient and liquid markets. It helps to prevent wide price swings and ensures that trades can be executed quickly and at fair prices. However, it also involves risks, as market makers must manage their inventory risk, which is the risk of holding too much or too little of the underlying asset.

In some markets, market-making is regulated to ensure fairness and transparency. For example, in the United States, the Securities and Exchange Commission (SEC) oversees market-making activities to prevent market manipulation and ensure that market makers are acting in the best interests of investors.