How Do Market Makers Make a Market?

In something like options, which are not a liquid there's not always a buyer and seller of every strike at all times. Across more liquid option chains, somebody's got to step in and make a market. They do it based on figuring out where they can oftset their risk in other places in the market. The key concept rate the golder is to take a dextracted yeel, like a business would, like an insurance company, or somebody else, a would, a margin, and to take little to no risk in the process.

Transcript

Play full episode

The AI-powered Podcast Player

Save insights by tapping your headphones, chat with episodes, discover the best highlights - and more!

Get the app