Get an overview of financial terms and their definitions.
A market maker is a firm or individual that buys or sells securities at any time with the goal of providing liquidity to the market and facilitating trade. Market makers typically hold an inventory of securities that they buy and sell, and they provide quotes to buyers and sellers using their capital and liquidity. Market makers play a crucial role in facilitating price discovery and trade execution by providing a source of demand and supply for securities. Market makers may operate on exchanges or in the over-the-counter (OTC) market.
A market taker buys or sells securities by accepting the price quoted by market makers or other traders. By contrast to market makers, who can buy and sell securities at any time and provide quotes to the market, market takers are passive participants who rely on quotes provided by others in order to execute trades. Market takers do not provide liquidity to the market in the same way that market makers do, but they can benefit from the liquidity provided by market makers and other traders by being able to quickly and easily buy and sell securities at quoted prices. Market takers may also be referred to as "buyers" and "sellers," depending on whether they are buying or selling securities.
A major currency is a term used to describe a currency that is widely traded and used in international transactions. Major currencies are typically from economically and politically stable countries, and are considered to be relatively liquid and stable compared to other currencies.