Which of the following statements is true of market makers?

Question

Quizplus · Accepted Answer

Market makers are intermediaries that bring together buyers and sellers in a capital market, both for equity and fixed income securities. They facilitate liquidity in the market by maintaining a bid-ask spread, which helps ensure that securities are traded efficiently. While commercial banks can serve as market makers, it is not true that they are not allowed to function as such. Market makers may include large institutional investors, but they are not necessarily the only ones who fulfill this role.

Which of the Following Statements Is True of Market Makers