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Finance Dictionary and Glossary of Investment Terms
double auction market
A system in which buyers enter competitive bidders and sellers enter competitive offers simultaneously, as opposed to the over-the-counter market, where trades are negotiated. Examples are the NYSE and the AMEX. A double auction market can also be carried out by open outcry, in which buyers and sellers call out prices that they are willing to buy and sell at, and a match is made if a buyer and seller call out the same price. Double auction markets usually feature a large number of buyers and sellers, and thus participants tend to incur lower transaction costs than in the over-the-counter market. also called auction market.
Systems by which listed securities are bought and sold through brokers on the securities exchanges, as distinguished from the OTC market, where trades are negotiated. Unlike the conventional auction with one auctioneer and many buyers, double auction markets consist of many sellers and many buyers.