please explain how market maker work

Discussion in 'Trading' started by NY_HOOD, Sep 6, 2007.

  1. especially during pre-market and after hours on news/earnings? thinly traded stocks opposed to liquid.
    thank you
  2. mde2004


    bottom line, they take your money. Be careful out there. Always remember you pay the spread and they sell it.
  3. As far as I know, there is no market maker per se.

    With electronic trading, the market maker for the same stock are many. I think, that is why MSFT is so liquid. Option spreads for leaps are some times 5 to 10 % of the option price.

    Only volume and open interest reflects and sometimes the basis of this spread.

    There are professional scalpers during outside normal hours.

    Some people trade the gaps, especially if the purchase is done by retail investor.

    Anybody who trades less than 5000 shares in my view is Retail Investor....