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I have never understood the implications of a quote or order-driven market.

When I look up securities on google in a way to see their prices, is that price the price of the exchange? the price of a quote driven market? the price of an order-driven market? Do quote- or order-driven market determine the price in the exchange? what is the relationship between them?

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    $\begingroup$ What you see is (usually) the transaction price: a trade took place at that price between 2 people. If you see two prices, one for selling one for buying then these are the quotes. $\endgroup$
    – nbbo2
    Commented Mar 21, 2022 at 16:53
  • $\begingroup$ So you say that If I google the share price of Apple and I see that the price is 163.83 USD, is that price the price of the exchange? of the order-driven market? of the quote-driven market? @noob2 $\endgroup$
    – Mining
    Commented Mar 21, 2022 at 17:05
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    $\begingroup$ @Mining that is the last price at which Apple traded between two parties for some quantity. $\endgroup$ Commented Mar 21, 2022 at 19:58

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Some terminology, including terms like "quotes" and "orders", has become obsolete in the modern equity or futures markets.

However, "quote-driven" or "order-driven" still have a clear distinction in FX markets, where the former typically refers to a pool where only approved liquidity providers may submit a best bid and offer that they're willing to quote, and the latter typically refers to a pool where any participant may submit any number of orders with different price and quantity and provide liquidity as such.

Usually, a different "maker" API or wire protocol is required to submit quotes and a liquidity provider in a "quote-driven" FX market will usually have the option to exercise last look on their quotes, while participants in an order-driven market will not. This can be further confusing as the same ECN may operate both a quote-driven pool and an order-driven pool, and even depending on the liquidity taker's preference, match incoming orders against contra-liquidity on both pools in a particular sequence. This is also confusing because different ECNs have different marketing terms for each pool, e.g. order-cross-order ("OXO") or order-cross-price ("OXP").

Many fixed income or OTC markets are also "quote-driven", e.g. a liquidity taker may submit a "request for quote" (RFQ) which broker-dealers respond to, and there is no order book structure.

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