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What Is a ‘Market Maker’ in the Context of OTC Liquidity?

Provides liquidity by quoting bid and ask prices; profits from the spread.
Greeks.Live23.11.25

What Is a ‘Market Maker’ in the Context of OTC Liquidity?

A market maker is a financial institution that provides liquidity in the OTC market by standing ready to quote both bid and ask prices for a specific derivative. They profit from the bid-ask spread and help facilitate trading in a market that lacks a centralized exchange's order book.

How Is the Bid-Ask Spread the Implicit Cost of a Trade for the Market Maker?
What Is a “Market Maker” and What Is Their Role in Reducing the Bid-Ask Spread?
Why Do Market Makers Prefer to Trade at the Bid or Ask Rather than the Mid-Price?
How Is ‘Bid-Ask Spread’ Related to Market Depth and Liquidity?

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