query: Does the bid/ask concept exist in dealer markets?

positive: "The Auction Market is where investors such you and me, as well as Market Makers, buy and sell securities.  The Auction Markets operate with the familiar bid-ask pricing that you see on financial pages such as Google and Yahoo.  The Market Makers are institutions that are there to provide liquidity so that investors can easily buy and sell shares at a ""fair"" price. Market Makers need to have on hand a suitable supply of shares to meet investor demands.  When Market Makers feel the need to either increase or decrease their supply of a particular security quickly, they turn to the Dealer Market. In order to participate in a Dealer Market, you must be designated a Market Maker.  As noted already, Market Makers are dedicated to providing liquidity for the Auction Market in certain securities and therefore require that they have on hand a suitable supply of those securities which they support.  For example, if a Market Maker for Apple shares is low on their supply of Apple shares, then will go the Dealer Market to purchase more Apple shares.  Conversely, if they are holding what they feel are too many Apple shares, they will go to the Dealer Market to sell Apple shares.  The Dealer Market does operate on a bid-ask basis, contrary to your stated understanding. The bid-ask prices quoted on the Dealer Market are more or less identical to those on the Auction Market, except the quote sizes will be generally much larger. This is the case because otherwise, why would a Market Maker offer to sell shares to another Market Maker at a price well below what they could themselves sell them for in the Auction Market.  (And similarly with buy orders.)  If Market Makers are generally holding low quantities of a particular security, this will drive up the price in both the Dealer Market and the Auction Market. Similarly, if Market Makers are generally holding too much of a particular security, this may drive down prices on both the Auction Market and the Dealer Market."

positive: "Why would there not be a bid and ask?  Dealers make their money in the spread between what they buy it from one entity for and what they sell it to another entity for.  This doesn't mean they have to do it auction-style, but they'll still have a different buy price from a sell price, hence ""bid"" and ""ask""."

negative: Bid and ask prices are the reigning highest buy price and lowest sell price in the market which doesn't mean one must only buy/sell at thise prices. That said one can buy/sell at whatever price they so wish although doing it at any other price than the bid/ask is usually harder as other market participants will gravitate to the reigning bid/ask price. So in theory you can buy at ask and sell at bid, whether or not your order will be filled is another matter altogether.

negative: "Re: A trader when buying needs to buy at the ask price and when selling needs to sell   at the bid price. So how can a trade happen 'in between' the bid and ask? Saying the trade can happen ""in between"" the bid & ask is simplistic.  There is a time dimension to the market.  It's more accurate to say that an order can be placed ""in between"" the current best bid & ask (observed at time T=0), thus establishing a new level for one or the other of those quoted prices (observed at time T>0). If you enter a market order to buy (or sell), then yes, you'll generally be accepting the current best ask (or best bid) with your order, because that's what a market order says to do: Accept the current best market price being offered for your kind of transaction.  Of course, prices may move much faster than your observation of the price and the time it takes to process your order – you're far from being the only participant. Market orders aside, you are free to name your own price above or below the current best bid & ask, respectively. ... then one could say that you are placing an order ""in between"" the bid and ask at the time your order is placed.  However – and this is key – you are also moving one or the other of those quoted prices in the process of placing your above-bid buy order or your below-ask sell order. Then, only if somebody else in the market chooses to accept your new ask (or bid) does your intended transaction take place. And that transaction takes place at the new ask (or bid) price, not the old one that was current when you entered your order. Read more about bid & ask prices at this other question: (p.s. FWIW, I don't necessarily agree with the assertion from the article you quoted, i.e.: ""By looking for trades that take place in between the bid and ask, you can tell when a strong trend is about to come to an end.""  I would say: Maybe, perhaps, but maybe not.)"

negative: "Market makers (shortened MM) in an exchange are generally required to list both a bid and ask price to allow both buyers and sellers to trade and keep the market moving.  However, a more general idea of a MM may includes companies off an exchange (say large banks acting as broker/dealers in an over-the-counter market) are not required to give a simultaneous bid/ask, but often will on request.  So, it might depend on where you are getting this data but likely the bid/ask was quoted simultaneously. An exchange, like the NASDAQ for instance, may have multiple MMs for a given market.  The ""market"" spread will be from the highest bid to the lowest ask over all the MMs.  The highest bid and lowest ask may come from different MMs and any particular MM often will have a larger spread. The size of the spread gives a rough idea of how much a MM is trying to make off of a ""round trip"" trade (buying than immediately selling to someone else or selling than immediately buying from someone else).  Of course, immediate round-trip trades are not always possible and there are many other complications.  However, half the spread is a rough indicator of how much they hope to make off of a single trade."

negative: Depends on when you are seeing these bids & asks-- off hours, many market makers pull their bid & ask prices entirely.  In a lightly traded stock there may just be no market except during the regular trading day.

negative: "Assuming that no one else has hit the ask, and the asks are still there, yes, you will fill $54.55 as long as you didn't exhaust that ask. Actually, there is no ""current price at which the stock is exchanging hands""; in reality, it is ""the last price traded"". The somebody who negotiated prices between buyers & sellers is the exchange through their handling of bids & asks.  The real negotiation comes between bids & asks, and if they meet or cross, a trade occurs. It's not that both bid & ask should be $54.55, it's that they were. To answer the title, the reasons why the bid and ask (even their midpoint) move away from the last price are largely unknown, but at least for the market makers, if their sell inventory is going away (people are buying heavily and they're running out of inventory) they will start to hike up their asks a lot and their bids a little because market makers try to stay market neutral, having no opinion on whether an asset will rise or fall, so with stocks, that means having a balanced inventory of longs & shorts.  They want to (sometimes have to depending on the exchange) accommodate the buying pressure, but they don't want to lose money, so they simply raise the ask and then raise the bid as people hit their asks since their average cost basis has risen. In fact (yahoo finance is great about showing this), there's rarely 1 bid and 1 ask.  Take a look at BAC's limit book: http://finance.yahoo.com/q/ecn?s=BAC+Order+Book You can see that there are many bids and many asks.  If one ask is exhausted, the next in line is now the highest.  The market maker who just sold at X will certainly step over the highest bid to bid at X*0.9 to get an 11% return on investment."

negative: The best ask is the lowest ask, and the best bid is the highest bid.  If the ask was lower than the bid then they crossed, and that would be a crossed market and quickly resolved. So the bid will almost always be cheaper than the ask. A heuristic is that a bid is the revenue of the stock at any given time while the ask is the cost, so the market will only ever offer a profit to itself not to the liquidity seeker. If examining the book vertically, all orders are usually sorted descending. Since the best ask is the lowest ask, it is on the bottom of the asks, and vice versa for the best bid. The best bid & best ask will be those closest since that's the narrowest spread and price-time priority will promise that a bid that crosses the asks will hit the lowest ask, the best possible price for the bidder and vice versa for an ask that crosses the best bid.

negative: "This is a misconception. One of the explanations is that if you buy at the ask price and want   to sell it right away, you can only sell at the bid price. This is incorrect. There are no two separate bid and ask prices. The price you buy (your ""bid"") is the same price someone else sells (their ""sell""). The same goes when you sell - the price you sell at is the price someone else buys. There's no spread with stocks. Emphasized it on purpose, because many people (especially those who gamble on stock exchange without knowing what they're doing) don't understand how the stock market works. On the stock exchange, the transaction price is the match between the bid price and the ask price. Thus, on any given transaction, bid always equals ask. There's no spread. There is spread with commodities (if you buy it directly, especially), contracts, mutual funds and other kinds of brokered transactions that go through a third party. The difference (spread) is that third party's fee for assuming part of the risk in the transaction, and is indeed added to your cost (indirectly, in the way you described). These transactions don't go directly between a seller and a buyer. For example, there's no buyer when you redeem some of your mutual fund - the fund pays you money. So the fund assumes certain risk, which is why there's a spread in the prices to invest and to redeem. Similarly with commodities: when you buy a gold bar - you buy it from a dealer, who needs to keep a stock. Thus, the dealer will not buy from you at the same price: there's a premium on sale and a discount on buy, which is a spread, to compensate the dealer for the risk of keeping a stock."

negative: Yes, but also note each exchange have rules that states various conditions when the market maker can enlarge the bid-ask (e.g. for situations such as freely falling markets, etc.) and when the market makers need to give a normal bid-ask. In normal markets, the bid-asks are usually within exchange dictated bounds.  MM's price spread can be larger than bid-ask spread only when there are multiple market makers and different market makers are providing different bid-asks. As long as the MM under question gives bid and ask within exchange's rules, it can be fine. These are usually rare situations. One advice: please carefully check the time-stamps. I have seen many occasions when tick data time-stamps between different vendors are mismatched in databases whereas in real life it isn't.  MM's profits not just from spreads, but also from short term mean-reversion (fading). If a large order comes in suddenly, the MM increases the prices in one direction, takes the opposite side, and once the order is done, the prices comes down and the MM off-loads his imbalance at lower prices, etc.

negative: "As an aside, on most securities with a spread of the minimum tick, there would be no bid ask spread if so-called ""locked markets"", where the price of the best bid on one exchange is equal to the price of the best ask on another, were permitted. It is currently forbidden for a security to have posted orders having the same price for both bid and ask even though they're on different exchanges. Option spreads would narrow as well as a result."

negative: Sounds to me like you're describing just how it should work.  Ask is at 30, Bid is at 20; you offer a new bid at 25.  Either: Depending on liquidity, one or the other may be more likely. This Investorplace article on the subject describes what you're seeing, and recommends the strategy you're describing precisely. Instead of a market order, take advantage of the fact that the options world truly is a marketplace — one where you can possibly get a better price just by asking. How does that work? If you use a limit order (instead of a market order) when opening a position, you can tell your broker how much you are willing to pay to enter a trade. For example, if you enter a limit price of $1.15, you can see whether the market-maker will bite. You will be surprised at how many times you will get your price (i.e., $1.15) instead of the ask price of $1.30. If your order at $1.15 is not filled after a few minutes, you can modify your order and pay the ask price by entering a market order or limit order at the ask price (that is, you can tell your broker to pay no more than $1.30).

negative: If you are buying your order will be placed in Bid list. If you are selling your order will be placed in the Ask list. The highest Bid price will be placed at the top of the Bid list and the lowest Ask price will be placed at the top of the Ask list. When a Bid and Ask price are matched a transaction will take place and it will the last traded price. If you are looking to buy at a lower price, say $155.01, your Bid price will be placed 3rd in the Bid list, and unless the Ask prices fall to that level, your order will remain in the list until it trades, it expires or you cancel it. If prices don't fall to you Bid price you will not get a trade. If you wanted your trade to go through you could either place a limit buy order closer to the lowest Ask price (however this is still not a certainty), or to be certain place a market buy order which will trade at the lowest Ask price.

negative: "Yes, almost always. I trade some of the most illiquid single stock options, and I would be absolutely murdered if I didn't try to work orders between the bid/ask.  When I say illiquid, I mean almost non-existent: ~50 monthly contracts on ALL contracts for a given underlying.  Spreads of 30% or more. The only time you shouldn't try to work an order, in my opinion, is when you think you need to trade immediately (rare), if implied volatility (IV) has moved to such a degree that the market makers (MM) won't hit your order while they're offering fair IV (they'll sometimes come down to meet you at their ""real"" price to get the exchange's liquidity rebate), or if the bid/ask spread is a penny. For illiquid single stock options, you need to be extremely mindful of implied and statistical volatility.  You can't just try to always put your order in the middle.  The MMs will play with the middle to get you to buy at higher IVs and sell at lower. The only way you can hope that an order working below the bid / above the ask will get filled is if a big player overwhelms the MMs' (who are lined up on the bid and ask) current orders and hits yours with one large order.  I've never seen this happen. The only other way is like you said: if the market moves against you, the orders in front of yours disappear, and someone hits your order, but I think that defeats the intent of your question."

negative: You can always trade at bid or ask price (depending if you are selling or buying). Market price is the price the last transaction was executed at so you may not be able to get that. If your order is large then you may not even be able to get bid/ask but should look at the depth of the order book (ie what prices are other market participants asking for and what is the size of their order). Usually only fast traders will trade at bid/ask, those who believe the price move is imminent. If you are a long term trader you can often get better than bid or ask by placing a limit order and waiting until a market participant takes your offer.

negative: Rule 610 (Google for it) stands that if Bid and Ask are the same, the market is considered Locked, and the exchange must stop all trading. So the same person can't quote the same bid and ask price. However, HFTs have found ways to circumvent this limitation when exchanges created special order types for them, e.g. Spam-and-Cancel

negative: "EVERYONE buys at the ask price and sells at the bid price (no matter who you are). There are a few important things you need to understand. Example: EVE bid: 16.00 EVE ask: 16.25 So if your selling EVE at ""market price"" you are entering an ask equal to the highest bid ($16.00). If you buy EVE at ""market price"" you are entering a bid equal to the lowest ask price ($16.25). Its key to understand this rule: ""An order executes ONLY when both bid and ask meet. (bid = ask)."" So a market maker puts in a bid when he wants to buy but the trade only executes when an ASK price meets his BID price. When you see a quote for a stock it is the price of the last trade. So it is possible to have a quote higher or lower then both the bid and the ask."

negative: When you place a bid between the bid/ask spread, that means you are raising the bid (or lowering the ask, if you are selling). The NBBO (national best bid and offer) is now changed because of your action, and yes, certain kinds of orders may be set to react to that (a higher bid or lower ask triggering them), also many algorithms (that haven't already queued an order simply waiting for a trigger, like in a stop limit) read the bid and ask and are programmed to then place an order at that point.

negative: In the world of stock exchanges, the result depends on the market state of the traded stock. There are two possibilities, (a) a trade occurs or (b) no trade occurs. During the so-called auction phase, bid and ask prices may overlap, actually they usually do. During an open market, when bid and ask match, trades occur.

negative: Your assets are marked to market. If you buy at X, and the market is bidding at 99.9% * X then you've already lost 0.1%. This is a market value oriented way of looking at costs. You could always value your assets with mark to model, and maybe you do, but no one else will.  Just because you think the stock is worth 2*X doesn't mean the rest of the world agrees, evidenced by the bid.  You surely won't get any margin loans based upon mark to model.  Your bankers won't be convinced of the valuation of your assets based upon mark to model. By strictly a market value oriented way of valuing assets, there is a bid/ask cost. more clarification Relative to littleadv, this is actually a good exposition between the differences between cash and accrual accounting. littleadv is focusing completely on the cash cost of the asset at the time of transaction and saying that there is no bid/ask cost.  Through the lens of cash accounting, that is 100% correct. However, if one uses accrual accounting marking assets to market (as we all do with marketable assets like stocks, bonds, options, etc), there may be a bid/ask cost.  At the time of transaction, the bids used to trade (one's own) are exhausted.  According to exchange rules that are now practically uniform: the highest bid is given priority, and if two bids are bidding the exact same highest price then the oldest bid is given priority; therefore the oldest highest bid has been exhausted and removed at trade. At the time of transaction, the value of the asset cannot be one's own bid but the highest oldest bid leftover.  If that highest oldest bid is lower than the price paid (even with liquid stocks this is usually the case) then one has accrued a bid/ask cost.

negative: "You can choose to place successively lower buy limit orders, but whether they get filled or not is not a given; it depends on whether sellers care to accept your bid. In your example of a 49.98 / 50.01 spread, if you place a buy with limit of 49.99, it won't get filled (if the order reaches the market while still at 49.98 / 50.01) immediately, but will be added to the order book.  By being added to the order book, the markets bid and ask become 49.99 / 50.01.  Your order won't get filled until some seller places a market order or a sell limit order of 49.99 or less.  No guarantee that that will happen, and even if it does, there's nothing to say that your follow-up buy at 49.98 will ever be filled.  In fact, your 49.98 buy order queues up at the ""end of the line"" behind all previously pending 49.98 bids, since your order arrived after those other bids.  Since the initial conditions you supposed had a 49.98 bid, such an order exists (or at least did exist; it might have been cancelled in the intervening moment. Basically, your first buy at 49.99, if it happens, has essentially no influence on whether your second buy at 49.98 will happen.  You can't expect to move the market lower by making a bid that is higher (49.99) than the existing best bid (49.98).  Whatever influence your 49.99 order has is to raise the market's price, not lower it."

negative: "Say we have stock XYZ that costs $50 this second. It doesn't cost XYZ this second. The market price only reflects the last price at which the security traded. It doesn't mean that if you'll get that price when you place an order. The price you get if/when your order is filled is determined by the bid/ask spreads. Why would people sell below the current price, and not within the range of the bid/ask? Someone may be willing to sell at an ask price of $47 simply because that's the best price they think they can sell the security for. Keep in mind that the ""someone"" may be a computer that determined that $47 is a reasonable ask price. Remember that bid/ask spreads aren't fixed, and there can be multiple bid/ask prices in a market at any given time. Your buy order was filled because at the time, someone else in the market was willing to sell you the security for the same price as your bid price. Your respective buy/sell orders were matched based on their price (and volume, conditional orders, etc). These questions may be helpful to you as well: Can someone explain a stock's ""bid"" vs. ""ask"" price relative to ""current"" price? Bids and asks in case of market order Can a trade happen ""in between"" the bid and ask price? Also, you say you're a day trader. If that's so, I strongly recommend getting a better grasp on the basics of market mechanics before committing any more capital. Trading without understanding how markets work at the most fundamental levels is a recipe for disaster."

negative: "ETFs purchases are subject to a bid/ask spread, which is the difference between the highest available purchase offer (""bid"") and the lowest available sell offer (""ask""). You can read more about this concept here. This cost doesn't exist for mutual funds, which are priced once  per day, and buyers and sellers all use the same price for transactions that day. ETFs allow you to trade any time that the market is open. If you're investing for the long term (which means you're not trying to time your buy/sell orders to a particular time of day), and the pricing is otherwise equal between the ETF and the mutual fund (which they are in the case of Vanguard's ETFs and Admiral Shares mutual funds), I would go with the mutual fund because it eliminates any cost associated with bid/ask spread."

negative: "Orders large enough to buy down the current Bid and Ask Book are common. This is the essential strategy through which larger traders ""Strip"" the Bid or Ask in order to excite motion in a direction that is favorable to their interests. Smaller traders will often focus on low float/small cap tickers, as both conditions tend to favor volatility on relatively small volume."

negative: You can*, if the market is open, in a normal trading phase (no auction phase), works, and there is an existing bid or offer on the product you want to trade, at the time the market learns of your order. Keep in mind there are 2 prices: bid and offer. If the current bid and current offer were the same, it would immediately result in a trade, and thus the bid and offer are no longer the same. Market Makers are paid / given lower fees in order to maintain buy and sell prices (called quotes) at most times. These conditions are usually all true, but commonly fail for these reasons: Most markets have an order type of market order that says buy/sell at any price. There are still sanity checks put in place on the price, with the exact rules for valid prices depending on the stock, so unless it's a penny stock you won't suddenly pay ten times a stock's value. *The amount you can buy sell is limited by the quantity that exists on the bid and offer. If there is a bid or offer, the quantity is always at least 1.

negative: "It's good to ask this question, because this is one of the fundamental dichotomies in market microstructure. At any time T for each product on a (typical) exchange there are two well-defined prices: At time T there is literally no person in the market who wants to sell below the ask, so all the people who are waiting to buy at the bid (or below) could very well be waiting there forever.  There's simply no guarantee that any seller will ever want to part with their product for a lesser price than they think it's worth. So if you want to buy the product at time T you have a tough choice to make: you get in line at the bid price, where there's no guarantee that your request will ever be filled, and you might never get your hands on the product you decide that owning the product right now is more valuable to you than (ask - bid) * quantity, so you tell the exchange that you're willing to buy at the ask price, and the exchange matches you with whichever seller is first in line Now, if you're in the market for the long term, the above choice is completely immaterial to you.  Who cares if you pay $10.00 * 1000 shares or $10.01 * 1000 shares when you plan to sell 30 years from now at $200 (or $200.01)? But if you're a day trader or anyone else with a very short time horizon, then this choice is extremely important: if the price is about to go up several cents and you got in line at the bid (and never got filled) then you missed out on some profit if you ""cross the spread"" to buy at the ask and then the price doesn't go up (or worse, goes down), you're screwed.  In order to get out of the position you'll have to cross the spread again and sell at at most the bid, meaning you've now paid the spread twice (plus transaction fees and regulatory fees) for nothing. (All of the above also applies in reverse for selling at the ask versus selling at the bid, but most people like to learn in terms of buying rather than selling.)"

negative: In practice, it would not work. If you put a bid in that was really out of line, even if it got filled, the exchange would reverse it.  Other than that it really depends on what the current bid/ask spread it, and what volume its trading, as well as how the market feels. Say the current bid is 11 and you put an order in with bid 11.5, it would soak up all the orders on the market up to the volume your buying. But once your order is filled the market will be determined by what the next order's bid/ask is. It might stay where you moved it too if others feels thats a fair price. But if every other order on the market is still at 11, then the price isnt gonna move.  tl;dl unless your a market maker, you could not realistically affect the price.

negative: I frequently do this on NADEX, selling out-of-the-money binary  calls. NADEX is highly illiquid, and the bid/ask is almost always from  the market maker. Out-of-the-money binary calls lose value quickly  (NADEX daily options exist for only ~21 hours). If I place an  above-ask order, it either gets filled quickly (within a few minutes)  due to a spike in the underlying, or not at all. I compensate by  changing my price hourly.  As Joe notes, one of Black-Scholes inputs is volatility, but price  determines (implied) volatility, so this is circular. In other words, you can  treat the bid/ask prices as bid/ask volatilities. This isn't as  far-fetched as it seems:  http://www.cmegroup.com/trading/fx/volatility-quoting-fx-options.html

negative: All the time. For high volume stocks, it may be tough to see exactly what's going on, e.g. the bid/ask may be moving faster than your connection to the broker can show you.  What I've observed is with options. The volume on some options is measured in the 10's or 100's of contracts in a day. I'll see a case where it's $1.80/$2.00 bid/ask, and by offering $1.90 will often see a fill at that price. Since I may be the only trade on that option in the 15 minute period and note that the stock wasn't moving more than a penny during that time, I know that it was my order that managed to fill between the bid/ask.

negative: "During market hours, there are a lot of dealers offering to buy and sell all exchange traded stocks. Dealers don't actually care about the company's fundamentals and they set their prices purely based on order flow. If more people start to buy than sell, the dealer notices his inventory going down and starts upping the price (both his bid and ask). There are also traders who may not be ""dealers"", but are willing to sell if the price goes high enough or buy if the price goes low enough. This keeps the prices humming along smoothly. During normal trading hours, if you buy something and turn around and sell it two minutes later, you'll probably be losing a couple cents per share. Outside normal market hours, the dealers who continue to have a bid and ask listed know that they don't have access to good price information --  there isn't a liquid market of continuous buying and selling for the dealer to set prices he considers safe. So what does he do? He widens the spread. He doesn't know what the market will open tomorrow at and doesn't know if he'll be able to react quickly to news. So instead of bidding $34.48 and offering at $34.52, he'll move that out to $33 and $36. The dealer still makes money sometimes off this because maybe some trader realized that he has options expiring tomorrow, or a short position that he's going to get a margin call on, or some kind of event that pretty much forces him to trade. Or maybe he's just panicking and overreacting to some news. So why not trade after hours? Because there's no liquidity, and trading when there's no liquidity costs you a lot."

negative: Not that I am aware. There are times that an option is available, but none have traded yet, and it takes a request to get a bid/ask, or you can make an offer and see if it's accepted. But the option chain itself has to be open.

negative: The everyday investor buys at the ask and sells at the bid but the market maker does the opposite This is misleading; it has nothing to do with being either an investor or a market maker. It is dependent on the type of order that is submitted. When a market trades at the ask, this means that a buy market order has interacted with a sell limit order at the limit price. When a market trades at the bid, this means that a sell market order has interacted with a buy limit order at the limit price. An ordinary investor can do exactly the same as a market maker and submit limit orders. Furthermore, they can sit on both sides of the bid and ask exactly as a market maker does. In the days before high frequency trading this was quite common (an example being Daytek, whose traders were notorious for stepping in front of the designated market maker's bid/ask on the Island ECN). An order executes ONLY when both bid and ask meet. (bid = ask) This is completely incorrect. A transaction occurs when an active (marketable) order is matched with a passive (limit book) order. If the passive order is a sell limit then the trade has occurred at the ask, and if it is a buy limit the trade has occurred at the bid. The active orders are not bids and asks. The only exception to this would be if the bid and ask have become crossed. When a seller steps in, he does so with an ask that's lower than the stock's current ask Almost correct; he does so with an order that's lower than the stock's current ask. If it's a marketable order it will fill the front queued best bid, and if it's a limit order his becomes the new ask price. A trade does not need to occur at this price for it to become the ask. This is wrong, market makers are the opposite party to you so the prices are the other way around for them. This is wrong. There is no distinction between the market maker and yourself or any other member of the public (beside the fact that designated market makers on some exchanges are obliged to post both a bid and ask at all times). You can open an account with any broker and do exactly the same as a market maker does (although with nothing like the speed that a high frequency market-making firm can, hence likely making you uncompetitive in this arena). The prices a market maker sees and the types of orders that they are able to use to realize them are exactly the same as for any other trader.

negative: The Bid price is simply the highest buy price currently being offered and the Ask price simply the lowest sell price being offered. The list of Bid and Ask prices is called the market depth. When the Bid and Ask prices match then a sale goes through. When looking to sell you would generally look at both the Bid and Ask prices. As a seller you want to be matched with the Bid price to get a sale, but you also need to check the current list of Ask prices. If the price you want to sell at is too high you will be placed down the Ask price list, and unless the price moves up to match your sell price you will not end up selling. On the other-hand, if your price to sell is too low and in fact much lower than the current lowest sell price you may get a quick sale but maybe at a lower price than you could have gotten. Similarly, when looking to buy, you would generally also look at both the Bid and Ask prices. As a buyer you want to be matched with the Ask price to get a sale, but you also need to check the current list of Bid prices. If the price you want to buy at is too low you will be placed down the Bid price list, and unless the price moves down to match your buy price you will no end up buying. On the other-hand, if your price to buy is too high and in fact much higher than the current highest buy price you may get a quick purchase but maybe at a higher price than you could have gotten. So, whether buying or selling, it is important to look at and consider both the Bid and Ask prices in the market depth.

negative: Investopedia has a section in their article about currency trading that states: The FX market does not have commissions. Unlike exchange-based markets, FX is a principals-only market. FX firms are dealers, not brokers. This is a critical distinction that all investors must understand. Unlike brokers, dealers assume market risk by serving as a counterparty to the investor's trade. They do not charge commission; instead, they make their money through the bid-ask spread. Principals-only means that the only parties to a transaction are agents who actively bear risk by taking one side of the transaction.  There are forex brokers who charge what's called a commission, based on the spread. Investopedia has another article about the commission structure in the forex market that states: There are three forms of commission used by brokers in forex. Some firms offer a fixed spread, others offer a variable spread and still others charge a commission based on a percentage of the spread.  So yes, there are forex brokers who charge a commission, but this paragraph is saying mostly the same thing as the first paragraph. The brokers make their money through the bid-ask spread; how they do so varies, and sometimes they call this charge a commission, sometimes they don't. All of the information above differs from the stock markets, however, in which  The broker takes the order to an exchange and attempts to execute it as per the customer's instructions. For providing this service, the broker is paid a commission when the customer buys and sells the tradable instrument. The broker isn't taking a side in the trade, so he's not making money on the spread. He's performing the service of taking the order to an exchange an attempting to execute it, and for that, he charges a commission.


query: Personal Tax Return software for Linux?

positive: TurboTax online works via Firefox (i.e. it is a cloud-based service.) I don't think any downloaded software is available directly for Linux.

positive: "I used H&R Block this year 2013 to do my 2012 taxes and it was a snap!  Ubuntu 12.10 with Firefox 20 and everything worked great!  Although it is not listed as one of the ""supported"" platforms, Firefox breezed through the application without any problems.  I used the deluxe version of H&R to calculate my mortgage and home business deductions, but I would guess any of the H&R versions work."

negative: Generally this gets corrected when you file returns for both States -- one owes you some refund, and younowe some money to the other. Multistate tax returns are their own special kettle of worms, so you might want to consider hiring a pro to straighten this out -- their software has some tools personal packages don't.

negative: "Does her dad still have the records from those tax years? If so, I would suggest using those as a basis and if they're complete, just filing them directly. If we're talking about software recommendations, I would suggest GenuTax as it allows for completing returns all the way back to 2003 without buying separate versions. Alternatively, there are some no-cost options. See the Wikipedia entry Comparison of Canadian-tax preparation software for personal use. Look both at the ""Price"" column and at the ""Freebies"" column. You should start at 2006 and move forward so you can keep track of carry-forward amounts. I'm assuming your girlfriend had no balance owing from those years as she was a student so there's no penalty to worry about."

negative: I did my own taxes previously using both H&R Block Tax Cut and TurboTax.  When I had a simple return and was single, it worked great.  Once I got married it was a little more complicated.  When I started a small side business, I switched to an accountant.  He does a great job of adjusting deductions between my wife and I and filing separately.  This minimizes the amount of taxes we have to pay.  It has been a few years since I used the software, but I did not see the ability to easily make adjustments like that.

negative: Largely it comes down to the complexity of your return (likely relatively simple if it's your first time filing) and your comfort level with using software. More complex returns would include filing business claims, handling stocks and investments, special return forms, etc.  One benefit to most of the software options out there such as TurboTax, HR Block, and Tax Slayer, are that they are free to use and you only pay when you're ready to file. You could give them a shot to see how easy/difficult they are and if you feel overwhelmed, then contact a CPA (whose time won't be free). Also remember that those HR Block seasonal places that open up are not CPA's, but are temps hired and trained to use the software that you would find online. You didn't indicate they were an option, but I like to point that out to those who might not know otherwise.  My opinion would be to use one of the online options because of cost and their ease of use. They also allow you to take your time and save your progress, so you can start using it and go ask questions/do research on your own time.

negative: "Unfortunately I don't think any of the online personal finance applications will do what you're asking. Most (if not all) online person finance software uses a combination of partnerships with the banks themselves and ""screen scraping"" to import your data. This simplifies things for the user but is typically limited to whenever the service was activated. Online personal finance software is still relatively young and doesn't offer the depth available in a desktop application (yet). If you are unwilling to part with historical data you spent years accumulating you are better off with a desktop application. Online Personal Finance Software Pros Cons Desktop Personal Finance Software Pros Cons In my humble opinion the personal finance software industry really needs a hybrid approach. A desktop application that is synchronized with a website. Offering the stability and tools of a desktop application with the availability of a web application."

negative: This form is due March 15. This year, the 15th is Saturday, so the deadline is Monday March 17th.  Keep in mind, the software guys would have two choices, wait until every last form is finalized before releasing, or put the software out by late November when 80%+ are good to go.  Nothing is broken in this process. Keep in mind that there are different needs depending on the individual. I like to grab a copy in early December, and have a preliminary idea of what my return with look like. I'll also know if I'll owe so much that I should send in a quarterly tax payment.  The IRS isn't accepting any return until 1/31 I believe, so you've lost no time.  When you open the program, it usually ask to 'phone home' and update. In a couple weeks, all should be well.  (Disclosure - I have guest posted on tax issues at both TurboTax and H&R Block's blogs. The above are my own views.)

negative: Free File is not software by the IRS.  Free File is actually a partnership between the IRS and the Free File Alliance, a group of tax software companies.  The software companies have all agreed to provide a free version of their tax software for low-income taxpayers. According to the Free File Alliance FAQ, the Alliance was formed in 2002 as part of a Presidential initiative to improve electronic access to government.  You can read all the excruciating details of the formal agreement (PDF) between the IRS and the Alliance, but basically, the participating software companies get exposure for their products and the possibility of up-selling services, such as state tax return software.

negative: Depending on what software you use. It has to be reported as a foreign income and you can claim foreign tax paid as a foreign tax credit.

negative: Here's a link with comparison of various online and offline PF software: http://personalfinancesoftwarereviews.com/compare-personal-finance-software/

negative: I have fairly simple tax returns and my experience was that TurboTax software produced roughly the same result as human accountant and costs much less. The accountant was never able to find any deductions that the program couldn't find.  Of course, if you have business, etc. you probably need an accountant to help you navigate all the rules, requirements, etc. But for simple enough cases I found that the additional pay is not justified.

negative: "From the IRS perspective, there's no difference between ""your taxes"" and ""your sole proprietorship's taxes"", they're all just ""your taxes"". While I could see it being very useful and wise to track your business's activities separately, and use separate bank accounts and the like, this is just a convenience to help you in your personal accounting, and not something that needs to relate directly to how tax forms are completed or taxes are paid. When calculating your taxes, if you want to figure out how much ""you"" owe vs. how much ""your business"" owes, you'll have to do so yourself. One approach might be just to take the amount that your Schedule C puts as income on your return and multiply by your marginal tax rate. Another approach might be to have your tax software run the calculations as though you had no business income, and see what just ""your personal"" taxes would have been without the business. If you think of the business income as being ""first"" and should use up the lower brackets rather than your personal income, maybe do it the other way around and have your software run the calculations as though you had only the business income and no other personal/investment income, and see what the amount of taxes would be then. Once you've figured out a good allocation, the actual mechanics of paying some ""personal tax amount"" from your personal bank account and some ""business tax amount"" from your business bank account are up to you. I'd probably just transfer the money from my business account to my personal account and pay all the taxes from the personal account. Writing two separate checks, one from each account, that total to the correct amount, I'm sure would work just fine as well. You can probably make separate payments from each account electronically through Direct Pay or EFTPS as well. As long as all taxes are paid by the deadline, I don't think the IRS is too picky about the details of how many payments are made."

negative: An animation video maker creates animation by using computer software. Animation firms use industry standard software that has supporting platforms Windows, Linux, and Mac OS. Ideally, the software must be intuitive providing a wide range of texturing and lighting. It must also have post processing functionality.

negative: **Linux**  Linux (pronounced /ˈlɪnəks/ LIN-əks or, less frequently, /ˈlaɪnəks/ LYN-əks) is a Unix-like computer operating system assembled under the model of free and open-source software development and distribution. The defining component of Linux is the Linux kernel, an operating system kernel first released on September 17, 1991 by Linus Torvalds. The Free Software Foundation uses the name GNU/Linux to describe the operating system, which has led to some controversy.  Linux was originally developed for personal computers based on the Intel x86 architecture, but has since been ported to more platforms than any other operating system. Because of the dominance of Android on smartphones, Linux has the largest installed base of all general-purpose operating systems.  ***  ^[ [^PM](https://www.reddit.com/message/compose?to=kittens_from_space) ^| [^Exclude ^me](https://reddit.com/message/compose?to=WikiTextBot&message=Excludeme&subject=Excludeme) ^| [^Exclude ^from ^subreddit](https://np.reddit.com/r/economy/about/banned) ^| [^FAQ ^/ ^Information](https://np.reddit.com/r/WikiTextBot/wiki/index)   ^] ^Downvote ^to ^remove ^| ^v0.21

negative: so far the only thing that I can think of that would make me want to go with H&R Block is the guarantee that they offer ( for a fee ) that says they will help you if you are ever audited for a tax return that you filed through them,  but I think that is given for both the software and the in person tax preparation.  so I guess if you like to ask lots of questions and get the answers nearly immediately I would go with an in person tax preparation person,  if they can't answer all your questions then that is something else to think about all together.

negative: Unfortunately, if your taxes are too complicated for the 1040EZ form, then your tax situation is effectively unique and you need to try both options and see for yourself which one is better. If you do your taxes yourself, you may be more likely to do a more thorough job in digging everything up.  You might even find that you can deduct some things that you hadn't thought of before. On the other hand, whenever I've gone to a tax professional, it's always been pretty much an all-or-nothing proposal.  You sit down with them and hand them your records, they ask a couple simple questions, and they either give you your completed tax return on-the-spot or they have you come back in a week for a brief review of the final numbers.  If they don't prepare your return on-the-spot, you can usually send additional items later on if you think of something that you forgot the first time around, but for the most part it's still a one-time shot. That said, I'm beginning to think the difference in monetary cost of completing even a mildly complex tax return is going to be insignificant, and the main factors to consider are the value of your own time and how much of the tax code you want to learn (because, in my experience, the software always refers to additional IRS forms or codes that are not automated in the software).  In theory, your tax return should be the same regardless of whether you have a tax professional do your taxes or, if you do them yourself, which software you use.  Given the same inputs, you should get about the same outputs.  Even though that theory doesn't always hold exactly true, all the options should get you in the same ballpark--close enough that it doesn't make much difference in the grand scheme of things, unless your tax return is done incorrectly (e.g., you choose the wrong filing status or forget to take a major deduction). Suppose you're married and you or your spouse is a partner in an LLC.  Maybe a tax professional wants to charge you $500 for your tax return (this will vary based on your circumstances).  You could alternatively buy the tax software for $40-$300 and spend 20+ hours navigating through the interviews and reviewing tax codes for the decisions and worksheets that are not automated in the software.  Depending on how much time you personally have to spend on the tax return, one option might be better than the other.  Maybe you have to pay your in-house accounting person to use the tax software, or you have to pay an employee to cover for you while you use the software.  Keep in mind that the tax professional and the tax software are probably deductible, whereas your time may not be.  In the end, even if you save money up front, it might be a wash on the following year's tax return, especially after you consider the uncompensated time that you could have spent with your family, on your business.

negative: If you would like to use linux I suggest you to use KMyMoney http://kmymoney2.sourceforge.net/ It is based on gnucash but it is easier to use IMO

negative: Not sure you are going to find anything like this in Excel - with the automatic lookup in specific. Microsoft has a template available; but it looks to be a pretty busy page. Why not look at other software?  If you have a PC, Quicken and Microsoft Money are of course the big guns.  You don't mention why you switched away from MS Money... There are many other packages as well.  The one that I use (but have no other financial interest in) is Moneydance as it was the best on Mac at the time I was looking.  It also runs on Windows and Linux.

negative: I second the vote for GnuCash. It runs on Linux, Windows, and Mac. It is double-entry accounting, so there is a little bit of a learning curve, but it sounds like you should probably have something a little more powerful than Mint for your situation.

negative: For double entry bookkeeping, personal or small business, GnuCash is very good. Exists for Mac Os.

negative: At the end of the year, the mutual fund company sends you a statement like any other investment and it has a bunch of boxes that you copy into your tax return software.  Then you just check the box that says 'tax-exempt' and you're done.

negative: There isn't one. I haven't been very happy with anything I've tried, commercial or open source. I've used Quicken for a while and been fairly happy with the user experience, but I hate the idea of their sunset policy (forced upgrades) and using proprietary format for the data files. Note that I wouldn't mind using proprietary and/or commercial software if it used a format that allowed me to easily migrate to another application. And no, QIF/OFX/CSV doesn't count. What I've found works well for me is to use Mint.com for pulling transactions from my accounts and categorizing them. I then export the transaction history as a CSV file and convert it to QIF/OFX using csv2ofx, and then import the resulting file into GNUCash. The hardest part is using categories (Mint.com) and accounts (GnuCash) properly. Not perfect by any means, but certainly better than manually exporting transactions from each account.

negative: IBM have been irrelevant to most developers for many years. MS are realising OSS has won and they are flocking to it. They are contributing to linux, even making their own distro, docker, kubernetes and have open sourced a heap of software including .net  They realise they need to win over developers and customers

negative: I use http://moneydance.com/ it has Mac, Windows and Linux versions and works well for my needs.

negative: "Donate buttons are meaningless with regards to taxes. This is payment for something you provided, and you cannot claim that you've received a gift. Any money you receive in this way is payment for your software. Remember, for gifts - no consideration should have been provided to the donor. Anything for which a consideration was provided - cannot be a gift. In your case the consideration is the software, and it's value is the amount you were paid. Since every person can decide how much to pay you on his own - any payment is for the software, not a gift. Any money you get is taxable to you, and you cannot claim it as ""gifts"" without exposing yourself to risks of making fraudulent claims. Consult a licensed tax adviser (EA/CPA licensed in your State) for a qualified tax advice."

negative: I'm glad keshlam and Bobby mentioned there are free tools, both from the IRS and private software companies.  Also search for Volunteer Income Tax Assistance (VITA) in your area for individual help with your return. A walk-in tax clinic strength is tax preparation.  CPAs and EAs provide a higher level of service.  For example, they compile and review your prior year's return and your current year, although that is not relevant to your current situation.  EAs and CPAs are allowed to represent you before the IRS.  They can directly meet or contact the IRS and navigate audits and other requests on your behalf.  Outside of tax season, an accountant can help you with tax planning and other taxable events. Some people do not hire a CPA or EA until they need representation.  Establishing a relationship and familiarity with an accountant now can save time and money if you do anticipate you will need representation later.  Part of what makes the tax code complicated is it can use very specific definitions of a common word.  Furthermore, the specific definition of a phrase or word can change between publications.  Also, the tax code uses all-encompassing definitions and provide detailed and lengthy lists that are not exhaustive; you may not find your situation listed or described in the tax code, yet you are responsible for reporting your taxable events.  The best software cannot navigate you through your tax situation like an accountant. Lastly, some of the smartest people I have met are accountants and to get the most out of meeting with them you should be as familiar as possible with your position.  The more familiar you are with accounting, the more advanced knowledge they can share with you. In short, you will probably need an accountant when: You need to explain yourself before the IRS (representation), you are encountering varying definitions in the tax code that have an impact on your return, or you have important economic activities that you are unsure of appropriate tax treatment.

negative: "Will this difference be given back in my next tax return If you compute your taxes correctly, yes you will get that money back when your tax return is processed. ""is it possible to return the check and modify how it's calculated if I talk to payroll?""  That is entirely up to your company but, probably not. It's a lot of effort for a comparatively small amount of money.  ""Any ideas?"" Yeah, you are doing your math wrong. A possible but more unlikely answer is your company's software screwed up."

negative: I use GnuCash which I really like.  However, I've never used any other personal finance software so I can't really compare.  Before GnuCash, I used an Excel spreadsheet which works fine for very basic finances. Pros Cons

negative: "Regardless of the source of the software (though certainly good to know), there are practical limits to the IRS 1040EZ form.  This simplified tax form is not appropriate for use once you reach a certain level of income because it only allows for the ""standard"" deduction - no itemization.   The first year I passed that level, I was panicked because I thought I suddenly owed thousands.  Switching to 1040A (aka the short form) and using even the basic itemized deductions showed that the IRS owed me a refund instead. I don't know where that level is for tax year 2015 but as you approach $62k, the simplified form is less-and-less appropriate.  It would make sense, given some of the great information in the other answers, that the free offering is only for 1040EZ.  That's certainly been true for other ""free"" software in the past."

negative: "My wife and I use to file ""married file separately"".  I consulted a tax accountant and it does not matter who's name the accounts are under.  The interest from the accounts can be counted as income on either person's tax return regardless of whose name is on the account.  You can even split the interest income between the returns if that is advantageous.  This is true for any income earned between the two of you. It use to be a big hassle to file this way even using the software programs.  The programs would not attempt to allocate the income between the tax returns in order to minimize my tax liability.  I had to do this manually.  Most of the loopholes have been closed and the last couple of years I've filed ""married filed jointly"". I'm not sure how your wife's citizenship status affects any of this."

negative: How many are PDF's? Is it enough that you must have an OCR tool? Word and HTML should be trivial to search through. You could get an IT guy or software engineer to sift through it using [catdoc](http://linux.die.net/man/1/catdoc) to convert the Word files to plain text and use [grep](http://en.wikipedia.org/wiki/Grep) to search for keywords. You could do it yourself if you're familiar with using linux command-line.

negative: um, no.   In a lot of ways, apple is much worse than MS with its proprietary everything.   MS will run on anything as will Linux.   Apple is truly great if you want new shiny, but I am less than impressed with its actual functionality in some ways.  I would personally use Linux on the desktop if I were going away from MS.

negative: If you use tax software to prepare your taxes, most packages have a planner for the next year.  You could use that.


query: understanding the process/payment of short sale dividends

positive: "I would suggest the following rationale : This appears to be a most unsatisfactory state of affairs, however, you can bet that this is how things are handled. As to who receives the dividend you have payed, this will be whoever the counter-party (or counter-parties) are that were assigned the exercise. EDIT Looking at the Dec16 SPY options, we see that the expiry date is 23 Dec.  Therefore, your options have been exercised prior to expiry.  The 3AM time stamp is probably due to the ""overnight batch processing"" of your brokers computer system.  The party exercising the options will have chosen to exercise on the day prior to ex-dividend in order to receive the dividends."

negative: "Suggest concretely writing out the 3-5 traits you're looking for, gaps you're looking to fill.  Assign an acronym to each bullet.  When you plan out your questions, write the acronym of the bullet you're looking to assess next to each Q.  If none fit, you should seriously consider why you're asking the question.  Here's some examples I used for a sales-related search:  ""(PO) Process Orientation - Understands the anatomy of sales, stage breakdown and discrete steps in a sales process. (CR) Creativity - Doesn't need a well established playbook of scripts, processes to make deals happen. ..."""

negative: I would never use a market order.  Some brokerages have an approval process your short-sale goes through before going to market.  This can take some time.  So the market prices may well be quite different later. Some brokerages use a separate account for short sales, so you must get their approval for the account before you can do the trade.   I like the listing of shares available for shorting the Interactive Brokers has but I have experienced orders simply going into dead-air and sitting there on the screen, not being rejected, not going to market, not doing anything --- even though the shares are on the list.

negative: No, not screwed. This is just an artifact of the tax code and year end dividends.  You paid a tax, and in return, got a higher basis. When you sell, you will have less profit, therefore less tax to pay than the guy who bought right after the dividend.  You can call the fund company if you want to buy later this year. Once you understand the process, it might not bother you at all.

negative: How is the current mortgage payment broken out? I have a mortgage on a rental property with a payment of $775, but $600 is principal. If I were at breakeven on a sale or a bit underwater, I'd be better off just holding still, the tenant paying the loan down over $7000/year.  You question is a good one, but a good answer would require more details. A bank may not agree to a short sale on an investment property, especially since there's a second property to go after. I'm not making a judgement, just saying, it's not a slam-dunk to just short sell it.

negative: The short term loan that accept any credit score is really merchant cash advance. They call it loan because clients do have options to pay as direct deposit but most of the times they would make clients switch to their credit card terminals so they can get percentage of daily sales as payment as well as percentage from their partner credit card company. And that kind of payment (percentage of daily credit card sales) is merchant cash advance.

negative: Ideally, stock price reflects the value of the company, the dividends it is expected to pay, and what people expect the future value of the company to be. Only one of those (maybe one and a half) is related to current  sales, and not always directly. Short-term motion of a stock is even less directly linked, since it also reflects previous expectations. A company can announce disappointing sales and see its stock go up, if the previous price was based on expecting  worse news.

negative: Get the cash you need to expand your business.  Free information. Call Now.  866-334-8705. Our goal: Helping small companies rebuild in this economy through private lending. We are looking for business owners that want to save money on their credit card processing or begin accepting credit cards. Grow your business now with a Merchant Cash Advance.  Funding of 100 - 300% of your monthly sales, no points or upfront fees. No fixed monthly payment.  Payment is automatically collected through credit card sales. We have partnered with several processors and other service providers to ensure the ability to offer Credit Card Processing with the lowest possible rates and fees for processing and funding in the industry. We also offer Gift Cards and Loyalty Programs to help you with repeat business. Call 866-334-8705 and mention Agent #22427 to speak to one of our knowledgeable representatives that can give you a quote today. http://agent.vendorsmerchantnetwork.com/22427

negative: If youre fifteen... Id actually recommend starting with some economics, just to understand the business decision making process. Mystery of Capital by Hernando de Soto is excellent. An online course from anywhere would be cool too.   Then, case studies are excellent as well. It depends on what you want to use ths for. Sales? Yeah, how to win friends and influence people, totally. A macro scale understanding, take the route I took.

negative: I believe that! Their system is meant to cause defaults. They are so disorganized and unhelpful. On three separate files for the same client, I dealt with lost documents and forced start over on the processes of approvals because they said documents weren't received in time, even though we had confirmations. I think if Congress could sit through a customer service call or process for some person trying to do a loan modification or get short sale approval, they would instantly call a senate investigation into their practices. I don't know how they can not be aware of the outright fuckery that goes on with their company.

negative: Rich's answer captures the basic essence of short selling with example. I'd like to add these additional points: You typically need a specially-privileged brokerage account to perform short selling.  If you didn't request short selling when you opened your account, odds are good you don't have it, and that's good because it's not something most people should ever consider doing.  Short selling is an advanced trading strategy.  Be sure you truly grok selling short before doing it. Consider that when buying stock (a.k.a. going long or taking a long position, in contrast to short) then your potential loss as a buyer is limited (i.e. stock goes to zero) and your potential gain unlimited (stock keeps going up, if you're lucky!)   Whereas, with short selling, it's reversed: Your loss can be unlimited (stock keeps going up, if you're unlucky!) and your potential gain is limited (i.e. stock goes to zero.)   The proceeds you receive from a short sale – and then some – need to stay in your account to offset the short position.  Brokers require this.  Typically, margin equivalent to 150% the market value of the shares sold short must be maintained in the account while the short position is open. The owner of the borrowed shares is still expecting his dividends, if any.  You are responsible for covering the cost of those dividends out of your own pocket.  To close or cover your short position, you initiate a buy to cover.  This is simply a buy order with the intention that it will close out your matching short position.   You may be forced to cover your short position before you want to and when it is to your disadvantage!  Even if you have sufficient margin available to cover your short, there are cases when lenders need their shares back.  If too many short sellers are forced to close out positions at the same time, they push up demand for the stock, increasing price and deepening their losses.  When this happens, it's called a short squeeze. In the eyes of the public who mostly go long buying stock, short sellers are often reviled. However, some people and many short sellers believe they are providing balance to the market and preventing it sometimes from getting ahead of itself. [Disambiguation: A short sale in the stock market is not related to the real estate concept of a short sale, which is when a property owner sells his property for less than he owes the bank.] Additional references:

negative: I don't think you've worked in sales. The high paying sales jobs usually have to compete in a competitive bid process. Companies don't just select vendors. They are mandated to create a competitive process to rule out what you're talking about. Of course, there are ways around this, but the norm is for a competitive sales process.

negative: Does it transfer your business? We offer a service of advice and search of buyers. We guide you through the whole process, helping you to get around the cheating of the buyers and, above all, to close the transaction with the best investor. value your business in Florida, you will have at your side a team very experienced and completely focused on the understanding of the business and the dynamics of your sector, working side by side with you to maximize the value at the time of the sale.

negative: Ya, that's a lot of data - especially considering your relative lack of experience and the likely fact that you have no idea what to do with what you're given.  How do you even know you need minute or tick-based bid-ask data?    You can get a lot more than OHLC/V/Split/Dividend.  You can get:  * Book Value; * Dividend information (Amount, yield, ex date, pay date); * EBITDA; * EPS (current AND estimates); * Price/sales ratio; * Price/book value; * Price/earnings ratio; * PEG ratio; * Short ratio; * Market cap.  Among other things, all for free.

negative: This was the day traders dilemma. You can, on paper, make money doing such trades. But because you do not hold the security for at least a year, the earnings are subject to short term capital gains tax unless these trades are done inside a sheltered account like a traditional IRA.  There are other considerations as well: wash sale rules and number of days to settle.  In short, the glory days of rags to riches by day trading are long gone, if they were ever here in the first place.  Edit: the site will not allow me to add a comment, so I am putting my response here: Possibly, yes. One big 'gotcha' is that your broker reports the proceeds from your sales, but does not report your outflows from your buys. Then there is the risk you take by the broker refusing to sell the security until the transaction settles. Not to mention wash sale rules. You are trying to win at the 'buy low, sell high' game. But you have a 25% chance, at best, of winning at that game. Can you pick the low? Maybe, but you have a 50% chance of being right. Then you have to pick the high. And again you have a 50% chance of doing that. 50% times 50% is 25%. Warren Buffet did not get rich that way. Buffet buys and holds. Don't be a speculator, be a 'buy and hold' investor. Buy securities, inside a sheltered account like a traditional IRA, that pay dividends then reinvest those dividends into the security you bought. Scottrade has a Flexible Reinvestment Program that lets you do this with no commission fees.

negative: Why is the stock trading at only $5 per share? The share price is the perceived value of the company by people buying and selling the stock. Not the actual value of the company and all its assets. Generally if the company is not doing well, there is a perceived risk that it will burn out the money fast. There is a difference between its signed conditional sale and will get money and has got money. So in short, it's trading at $5 a share because the market doesn't feel like it's worth $12 per share. Quite a few believe there could be issues faced; i.e. it may not make the $12, or there will be additional obligations, i.e. employees may demand more layoff compensation, etc. or the distribution may take few years due to regulatory and legal hurdles. The only problem is the stock exchange states if the company has no core business, the stock will be suspended soon (hopefully they can release the $12 per share first). What will happen if I hold shares in the company, the stock gets suspended, and its sitting on $12 per share? Can it still distribute it out? Every country and stock markets have laid out procedures for de-listing a company and closing a company. The company can give $10 as say dividends and remaining later; or as part of the closure process, the company will distribute the balance among shareholders. This would be a long drawn process.

negative: "Securities clearing and settlement is a complex topic - you can start by browsing relevant Wikipedia articles, and (given sufficient quantities of masochism and strong coffee) progress to entire technical books. You're correct - modern trade settlement systems are electronic and heavily streamlined.  However, you're never going to see people hand over assets until they're sure that payment has cleared - given current payment systems, that means the fastest settlement time is going to be the next business day (so-called T+1 settlement), which is what's seen for heavily standardized instruments like standard options and government debt securities. Stocks present bigger obstacles.  First, the seller has to locate the asset being sold & make sure they have clear title to it... which is tougher than it might seem, given the layers of abstraction/virtualization involved in the chain of ownership & custody, complicated in particular by ""rehypothecation"" involved in stock borrowing/lending for short sales... especially since stock borrow/lending record-keeping tends to be somewhat slipshod (cf. periodic uproar about ""naked shorting"" and ""failure to deliver""). Second, the seller has to determine what exactly it is that they have sold... which, again, can be tougher than it might seem.  You see, stocks are subject to all kinds of corporate actions (e.g. cash distributions, spin-offs, splits, liquidations, delistings...)  A particular topic of keen interest is who exactly is entitled to large cash distributions - the buyer or the seller?  Depending on the cutoff date (the ""ex-dividend date""), the seller may need to deliver to the buyer just the shares of stock, or the shares plus a big chunk of cash - a significant difference in settlement.  Determining the precise ex-dividend date (and so what exactly are the assets to be settled) can sometimes be very difficult... it's usually T-2, except in the case of large distributions, which are usually T+1, unless the regulatory authority has neglected to declare an ex-dividend date, in which case it defaults to standard DTC payment policy (i.e. T-2)... I've been involved in a few situations where the brokers involved were clueless, and full settlement of ""due bills"" for cash distributions to the buyer took several months of hard arguing. So yeah, the brokers want a little time to get their records in order and settle the trade correctly."

negative: "Dividend yields can also reflect important information about the company's status. For example, a company that has never lowered or stopped paying dividends is a ""strong"" company because it has the cash/earnings power to maintain its dividend regardless of the market. Ideally, a company should pay dividends for at least 10 years for an investor to consider the company as a ""consistent payer."" Furthermore, when a company pays dividend, it generally means that it has more cash than it can profitably reinvest in the business, so companies that pay dividends tend to be older but more stable. An important exception is REIT's and their ilk - to avoid taxation, these types of funds must distribute 90% of their earnings to their shareholders, so they pay very high dividends. Just look at stocks like NLY or CMO to get an idea. The issue here, however, is two fold: So a high dividend can be great [if it has been paid consistently] or risky [if the company is new or has a short payment history], and dividends can also tell us about what the company's status is.  Lastly, taxation on dividend income is higher than taxation on capital gains, but by reinvesting dividends you can avoid this tax and lower your potential capital gain amount, thus limiting taxes.  http://www.tweedy.com/resources/library_docs/papers/highdiv_research.pdf is an excellent paper on dividend yields and investing."

negative: "You're absolutely right.  I'm not commenting on the fact that retail stores still do massively more business than Online, nor the that they have a significant advantage when the balance begins to shift.   My only comment is that their data doesn't support their conclusion. They concluded that 90% of business is done in retail stores. No, 90% of business *involves a retail component*, including the somewhat dubious ""Returns""- which is not part of the sales process and would understandably want to happen in a retail setting."

negative: "I held shares in BIND Therapeutics, a small biotechnology company on the NASDAQ that was liquidated on the chapter 11 auction block in 2016. There were sufficient proceeds to pay the debts and return some cash to shareholders, with payments in 2016 and 2017. (Some payments have yet to occur.) The whole process is counter-intuitive and full of landmines, both for tax preparation & planning and receiving payments: Landmine 0: Some shareholders will sell in a panic as soon as the chapter 11 is announced.  This would have been a huge mistake in the case of BIND, because the eventual liquidation payments were worth 3 or so times as much as the share price after chapter 11.  The amount of the liquidation payments wasn't immediately calculable, because the company's intellectual property had to be auctioned. Landmine 1: The large brokerages (Vanguard, Fidelity, TDA, and others) mischaracterized the distributions to shareholders on form 1099, distributed to both shareholders and the IRS. The bankruptcy trustee considered this to be their responsibility. According to the tax code and to the IRS website, the liquidation is taxed like a sale of stock, rather than a dividend. ""On the shareholder level, a complete liquidation can be thought of as a sale of all outstanding corporate stock held by the shareholders in exchange for all of the assets in that corporation. Like any sale of stock, the shareholder receives capital gain treatment on the difference between the amount received by the shareholder in the distribution and the cost or other basis of the stock."" Mischaracterizing the distributions as dividends makes them wrongly ineligible to be wiped out by the enormous capital loss on the stock.  Vanguard's error appeared on my own 1099, and the others were mentioned in an investor discussion on stocktwits.  However, Geoffrey L Berman, the bankruptcy trustee stated on twitter that while the payments are NOT dividends, the 1099s were the brokers' responsibility. Landmine 2: Many shareholders will wrongly attempt to claim the capital loss for tax year 2016, or they may have failed to understand the law in time for proper tax planning for tax year 2016. It does not matter that the company's BINDQ shares were cancelled in 2016.  According to the IRS website ""When a shareholder receives a series of distributions in liquidation, gain is recognized once all of the shareholder's stock basis is recovered. A loss, however, will not be recognized until the final distribution is received."" In particular, shareholders who receive the 2017 payment will not be able to take a capital loss for tax year 2016 because the liquidation wasn't complete.  Late discovery of this timing issue no doubt resulted in an end-of-year underestimation of 2016 overall capital gains for many, causing a failure to preemptively realize available capital losses elsewhere. I'm not going to carefully consider the following issues, which may or may not have some effect on the timing of the capital loss: Landmine 3: Surprisingly, it appears that some shareholders who sold their shares in 2016 still may not claim the capital loss for tax year 2016, because they will receive a liquidation distribution in 2017. Taken at face value, the IRS website's statement ""A loss, however, will not be recognized until the final distribution is received"" appears to apply to shareholders of record of August 30, 2016, who receive the payouts, even if they sold the shares after the record date.  However, to know for sure it might be worth carefully parsing the relevant tax code and treasury regs. Landmine 4: Some shareholders are completely cut out of the bankruptcy distribution. The bankruptcy plan only provides distributions for shareholders of record Aug 30, 2016.  Those who bought shares of BINDQ afterwards are out of luck. Landmine 5: According to the discussion on stocktwits, many shareholders have yet to receive or even learn of the existence of a form [more secure link showing brokers served here] required to accept 2017 payments.  To add to confusion there is apparently ongoing legal wrangling over whether the trustee is able to require this form. Worse, shareholders report difficulty getting brokers' required cooperation in submitting this form. Landmine 6: Hopefully there are no more landmines. Boom. DISCLAIMER: I am not a tax professional. Consult the tax code/treasury regulations/IRS publications when preparing your taxes.  They are more trustworthy than accountants, or at least more trustworthy than good ones."

negative: If you really believe that the US isn't the most litigous societies in the world, I don't know what to tell you. I believe this administration has been the most difficult to understand, and therefore I can also agree with confusing. Bureaucratic, while perhaps other countries have us beat in more processes, the overall lack of alignment between processes and goals would probably qualify that statement as well. You should read into him though, he's a pretty smart guy who has made some good decisions, including giving up short term profits because of the risk to society.

negative: Not perhaps practically useful, but I found it conceptually useful to learn the basics of mathematical finance, a way of describing financial markets via probability theory and stochastic processes. It's a little like trying to understand horse racing by studying spherical horses rolling without friction in a vacuum, but it does give you some ways of thinking that may be more appealing to someone with a math background. For instance, there's the idea that shorting a stock is effectively owning negative shares. Option pricing is a common motivation. There's a brief introduction, at the advanced undergraduate level, in Durrett's Essentials of Stochastic Processes. At the graduate level, I liked Ruth Williams' Introduction to the Mathematics of Finance.

negative: "I thought the other answers had some good aspect but also some things that might not be completely correct, so I'll take a shot. As noted by others, there are three different types of entities in your question:  The ETF SPY, the index SPX, and options contracts. First, let's deal with the options contracts.  You can buy options on the ETF SPY or marked to the index SPX.  Either way, options are about the price of the ETF / index at some future date, so the local min and max of the ""underlying"" symbol generally will not coincide with the min and max of the options.  Of course, the closer the expiration date on the option, the more closely the option price tracks its underlying directly.  Beyond the difference in how they are priced, the options market has different liquidity, and so it may not be able to track quick moves in the underlying. (Although there's a reasonably robust market for option on SPY and SPX specifically.) Second, let's ask what forces really make SPY and SPX move together as much as they do.  It's one thing to say ""SPY is tied to SPX,"" but how?  There are several answers to this, but I'll argue that the most important factor is that there's a notion of ""authorized participants"" who are players in the market who can ""create"" shares of SPY at will.  They do this by accumulating stock in the constituent companies and turning them into the market maker.  There's also the corresponding notion of ""redemption"" by which an authorized participant will turn in a share of SPY to get stock in the constituent companies. (See http://www.spdrsmobile.com/content/how-etfs-are-created-and-redeemed and http://www.etf.com/etf-education-center/7540-what-is-the-etf-creationredemption-mechanism.html) Meanwhile, SPX is just computed from the prices of the constituent companies, so it's got no market forces directly on it.  It just reflects what the prices of the companies in the index are doing. (Of course those companies are subject to market forces.) Key point: Creation / redemption is the real driver for keeping the price aligned.  If it gets too far out of line, then it creates an arbitrage opportunity for an authorized participant.  If the price of SPY gets ""too high"" compared to SPX (and therefore the constituent stocks), an authorized participant can simultaneously sell short SPY shares and buy the constituent companies' stocks.  They can then use the redemption process to close their position at no risk.  And vice versa if SPY gets ""too low."" Now that we understand why they move together, why don't they move together perfectly.  To some extent information about fees, slight differences in composition between SPY and SPX over time, etc. do play.  The bigger reasons are probably that (a) there are not a lot of authorized participants, (b) there are a relatively large number of companies represented in SPY, so there's some actual cost and risk involved in trying to quickly buy/sell the full set to capture the theoretical arbitrage that I described, and (c) redemption / creation units only come in pretty big blocks, which complicates the issues under point b. You asked about dividends, so let me comment briefly on that too.  The dividend on SPY is (more or less) passing on the dividends from the constituent companies. (I think - not completely sure - that the market maker deducts its fees from this cash, so it's not a direct pass through.)  But each company pays on its own schedule and SPY does not make a payment every time, so it's holding a corresponding amount of cash between its dividend payments.  This is factored into the price through the creation / redemption process.  I don't know how big of a factor it is though."

negative: "I would say that all of the reasons you list in your question are valid, and I would add the following... You are in the landscaping business, not the accounting business. If you manage everything in spreadsheets, at least one of you has to become the bookkeeper and leave the landscaping to the others. Spreadsheets are ""agnostic"" in how you use them, so you have to turn them into an accounting system, which means you're now not only more of a bookkeeper, but you're also more of a developer, too, and even less of a landscaper. Accounting software is already developed by developers who understand accounting. Using it requires you to only perform the data entry tasks, and then you can focus on the landscaping, customer service, sales and marketing, etc., things that actually contribute to your business.  It is still good for you to understand basic accounting principles. Specialized accounting software will guide you through the process of learning and help you avoid making many of the costly mistakes you might have made in that learning process."

negative: Canada does not have tax lien certificates. Instead, they do tax deed sales.  Because the process is much further along, often involving local sheriffs, it is much closer to a U.S. foreclosure sale/auction process than a tax lien as you are likely thinking.  The laws and processes vary by province as well, so you'll want to contact the provincial government tax offices to get the details.

negative: There's really not a simple yes/no answer.  It depends on whether you're doing short term trading or long term investing.  In the short term, it's not much different from sports betting (and would be almost an exact match if the bettors also got a percentage of the team's ticket sales), In the long term, though, your profit mostly comes from the growth of the company.  As a company - Apple, say, or Tesla - increases sales of iPhones or electric cars, it either pays out some of the income as dividends, or invests them in growing the company, so it becomes more valuable.  If you bought shares cheaply way back when, you profit from this increase when you sell them.  The person buying it doesn't lose, as s/he buys at today's market value in anticipation of continued growth.  Of course there's a risk that the value will go down in the future instead of up. Of course, there are also psychological factors, say when people buy Apple or Tesla because they're popular, instead of at a rational valuation.  Or when people start panic-selling, as in the '08 crash.  So then their loss is your gain - assuming you didn't panic, of course :-)

negative: Whenever a website mentions Hypothetical Growth of $100, $1,000, or $10,000, it assumes that that investor himself will reinvest the dividend. This is true whether you look at Morningstar or Financial Times.  Unless the website does not have dividend data, e.g. Google Finance.  If you want to compare the account value after withdrawing dividends:   Since the Income class pays dividends annually, there will be 1 jumps per year.  For example, the 2013 dividend payment:  and the 2014 dividend payment:

negative: What I should have done in the first place was just ask them.  From their customer support team: Thanks for writing in and for your interest in Square. It is perfectly acceptable to use Square for personal business, such as a yard sale. You do not need to have a registered business to take advantage of Square and the ability to accept credit cards. Just please note that it is against our Terms of Service to process prepaid cards, gift cards or your own credit card using your own Square account. Additionally, you may not use Square as a money transfer system. For every payment processed through Square, you must provide a legitimate good or service. Please let me know if you have any additional concerns.

negative: "Summary: The corporation pays 33.3% tax on dividends it receives and gets a tax refund at the same rate when it pays dividends out. According to http://www.kpmg.com/Ca/en/IssuesAndInsights/ArticlesPublications/TaxRates/Federal-and-Provincial-Territorial-Tax-Rates-for-Income-Earned-CCPC-2015-Dec-31.pdf the corporate tax rates for 2015 are: According to page 3: The federal and provincial tax rates shown in the tables apply to investment income   earned by a CCPC, other than capital gains and dividends received from Canadian   corporations. The rates that apply to capital gains are one-half of the rates shown in   the tables. Dividends received from Canadian corporations are deductible in computing   regular Part I tax, but may be subject to Part IV tax, calculated at a rate of 33 1/3%. If I understand that correctly, this means that a Corporation in Quebec pays 46.6% on investment income other than capital gains and dividends, 23.3% on capital gains and 33.33% on dividends. I'm marking this answer as community wiki so anyone can correct these numbers if they are incorrect. UPDATE: According to http://www.pwc.com/ca/en/tax/publications/pwc-facts-figures-2014-07-en.pdf page 22 the tax rate on taxable dividends received from certain Canadian corporations is 33 1/3%. Further, this is refunded to the corporation through the ""refundable dividend tax on hand"" (RDTOH) mechanism at a rate of $1 for every $3 of taxable dividends paid. My interpretation is as follows: if the corporation receives $100 of dividends from another company, it pays $33.33 tax. If that corporation then pays out $100 of dividends at a later time, it receives a tax refund of $33.33. Meaning, the original tax gets refunded. Note the first line is for the 2015 tax year while the second link is for the 2014 tax year. The numbers might be a little different but the tax/refund process remains the same."

negative: A bond has a duration that can be easily calculated. It's the time weighted average of all the payments you'll receive and helpful to understand the effect a change in rates will have on that instrument.  The duration of a stock, on the other hand, is a forced construct to then use in other equations to help calculate, say, the summation of a dividend stream. I can calculate the duration of a bond and come up with an answer that's not up for discussion or dispute. The duration of a stock, on the other hand, isn't such a number. Will J&J last 50 more years? Will Apple? Who knows?

negative: The phrase doesn't mean anything specifically. Your SO could start paying the payments, but the title and lien would remain in your name.  If you wanted to change the title or lien to be in her name, you would have to sell the car to her (sales tax would be involved but the process would be relatively painless).  You could sell her the car for a pretty cheap price, but not $1. (unless the depreciated value of the car was less than the rest of the loan amount). You could draft up an agreement that if you break up or something, she agrees to buy the car from you for $x dollars minus all the payments she has made on the car.

negative: "I have my ""safe"" money in index funds but like to dabble in individual stocks. My criteria and thought process are usually like this, let's use SBUX as an example: Understand what the company does. Also paraphrased as ""buy what you know"". A profitable/growing business doesn't need to be complicated. Open stores. Sell coffee. For SBUX, my decision process literally started inside a store: ""Rocky, why are you standing in line to overpay for coffee? Wow, look at all these people! Hmmm. I wonder if this is a good stock to buy?"" Check out their fundamentals. Are they profitable? P.E.ratio, book value, and PEG are helpful, and I tend to use them as a gauge for whether I think the stock is overpriced or not. I compare those values to others in the industry. SBUX right now has a PE of ~30, which looks about average for its peers (PEP, KKD, GMCR). So far so good. Does it pay a dividend? This isn't necessarily good or bad, just useful to know. I like dividend-paying stocks, even if it means the stock price might not grow as aggressively. Also, a company that pays a dividend is naturally confident in its ability to turn a profit and generate cash. So it's a safer pick, in my opinion. SBUX pays a dividend, a small one, but that's a plus for me. Am I willing to watch the stock? With my index funds, I buy and forget. With my stocks, I keep an eye on the situation, read the news, and have to make a buy/sell decision regularly. With SBUX, I don't watch all that closely, I just keep up with the news. IMO, it's still a buy based on all the above criteria. And I feel less silly now standing in line to overpay for coffee."

negative: They don't need to know how to actually write code, but they should understand the process of writing code. I don't expect a CEO to understand each line in the chain of the distribution centers but I do expect them to understand the process enough to make a logical decision.  CEO's don't need to be able to write code, but they should understand what it takes to get that code to a production environment and what risks are involved with different types of code pushes.