Like...if you travel to Japan to get a penile implant that's illegal in the U.S. One kind of specialist unit.
Also, a thing that once acted as a facilitator in maintaining market liquidity.
The name "specialist unit," has largely been replaced by other terms. The job itself has become somewhat old-fashioned, thanks to the advent of electronic exchanges. However, tasks related to what's now called designated market makers, or supplemental market makers, are close to what specialist units used to do. These positions exist as part of the workings of the NYSE.
The goal of the specialist unit (back when there was such a thing) was to keep the market for a particular security on an even keel. The specialist unit had its own inventory of stock, which it dipped into when it needed to maintain liquidity for the stock. It also acted as an agent for brokers.
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Finance: What is a Specialist?6 Views
Finance allah shmoop what is a specialist I wouldn't have
a movie stallone wait different kind of specialist in finance
land a specialist is the gala guy trading in a
given stock that is there a member of a stock
exchange and they might carry inventory of satan Ten million
shares of microsoft trading currently at around forty bucks a
share their offering msft for sale at forty point Oh
five and they're our buyer of msft this moment at
thirty nine ninety one and see there's a fourteen cents
a share spread their meaning that they make fourteen cents
every time they transact So let's say that specialist sells
a million shares of microsoft today earning a fourteen cents
spread per share while fourteen cents times a million one
hundred forty grand and clown Nice payday for one day's
work so that's a pretty widespread in the scheme of
things because often brokers have to tack on their own
commission of a few cents on either side and the
specialist might in fact be dealing from their inventory to
brokers on both sides of a transaction in which case
they're spread I even spread to the actual specialist might
Be just a few cents times those million shares like
four cents times a million gets to forty grand Something
like that It's still a really good living but if
it's so good then why don't millions of people fight
for that job Like how hard is it tio Just
nod your head and right down buy or sell and
then a number you think everyone who flips burgers at
mcdonald's and is afraid of robots taking their jobs would
be killing for this gig Well in order to be
a spy specialist not only do you need you know
special education and a few siri's license exams but you
also need capital with which to buy inventory risky inventory
which you'll hold as if they are casino chips and
you are more or less the house So when the
microsoft shares example just to be a specialist in that
one stock well you have to raise something like one
hundred million dollars because you'll have to go into the
market to start and simply by two or three and
call two and a half million shares at around forty
bucks each for a total cost of a condo or
a silicon valley unit that's What a units called out
here and yes that's an investment and the stock could
go up but it could go down as well leaving
you holding a big fat smoldering bag of dog craft
dot com and also going whoever your investors or creditors
workout hundred million dollars Like if microsoft has kind of
evaporated you know what could happen More risks will hunt
your sleep in that the stock and suddenly gap down
three dollars on a bad quarter at which point your
spreads must widen to accommodate expected further volatility in the
stock And you then compete with other specialists who also
make a market in microsoft Well at any given time
they may want to get out of trading in it
and undercut you Buy a penny or two a share
leaving you as the sole big owner of what will
feel like a stock version of the titanic Well the
math gets complex is the market gets volatile specialists use
hedges and human beings end up competing against a i'd
driven black box computers But the reason you exist as
a specialist or rather the key job or responsibility of
the specialist is to provide liquidity That is you have
to buy and sell shares to accommodate the market that's
your job and in volatile markets It means that they
might run out of inventory or be squeezed and have
to buy shares at much higher or sell shares at
much lower prices than their cost But that's the risk
you take when you become a specialist they must execute
on these trades and if they don't they lose their
c This is specialist on the exchange altogether and are
more or less fully out of work And you know
i don't know working for uber lift or something next
Yeah and at that point well they might be willing 00:03:58.973 --> [endTime] Tio take just about anything for a ride