Glossary: M

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Main Market

The Exchange’s principal market for listed companies from the UK and overseas.

 

Management fee - investment trust

A fixed fee that a fund manager charges for his services.

 

Mandatory quote period (MQP)

The period during which market makers on the Exchange’s quote driven SEAQ and SEAQ International services are obliged to make a firm two-way quote for the securities in which they are registered. This is 0800-1630 hours for SEAQ and 0930-1530 hours for SE.

 

Margin

An account with a broker where a client is able to purchase securities on credit after the margin has been deposited.

 

Market Abuse

A conduct that adversely affects a financial market and falls below the standards expected by the regular user of that market. The Finance Conduct Authority (FCA) can enforce disciplinary action against those who commit such abuses.

 

Market capitalisation

Market capitalisation is used to indicate the value of a company by multiplying the number of shares in issue by the current share price.

 

Market maker

A Securities firm which is obliged to offer to buy and sell securities in which it is registered throughout the mandatory quote period.

 

Market Maker to Market Maker

The transaction was between two market makers registered in the security in question.  This may also include those executed through an inter-dealer broker or a public display system.

 

Market manipulation

The offence of illegally inflating or deflating the price of a security.

 

Market offence

An illegal/criminal conduct that adversely affects the market.

 

Market order

An unpriced order submitted to an order book to deal in a specified number of shares. Unexecuted portions of a market order are added to the order book.

 

Market order extension

A time extension to the auction call period. It occurs if market orders are going to remain unexecuted after the auction match. The extension allows further entry and deletion of orders.

 

Market price

The price of a security. For shares, there are two prices quoted on the exchange – bid price and offer price.

 

Market Regulation Department

A department that monitors and enforces the rules of the Exchange.

 

Market Share

Dissemination of market share and ranking information to member firms.

 

Maturity period

This is the life of a bond or security. A bond usually ranges from 5 to 15 years but a few government bonds may even have a lifespan of 25 to 50 years.

 

Maximum spread

The maximum permissible difference between the bid and offer prices of a security.

 

Member firm

An investment firm which is a member of the Exchange and which may deal in securities on our market on behalf of its clients, or on behalf of the firm itself.

 

Mergers

In a merger, two companies come together to become one. The shareholders of the merging companies often become joint owners of the combined entity.

 

Mid price

A price between the offer and bid price. The mid price is equal to the sum of the best bid price and the best offer price divided by two, and rounded up to be consistent with the relevant price format.

 

Mid-cap shares

A company with a medium-sized market capitalisation.

 

Misuse of information

The abuse of dealing in securities based on information that is not publicly available. This abuse is similar to the offence of insider dealing.

 

Millennium Exchange

The London Stock Exchange’s real-time information service, used to disseminate market data to customers.

 

MOC1

Closing Market Order Extension, no Price Monitoring Extension, supports volume check

 

MOCX

Closing Market Order Extension

 

MOE1

Market Order Extension, no Price Monitoring Extension

 

MOEX

Market Order Extension

 

Money flow per security

The cumulative value of trades executed and the value of orders residing on each side of the order book for each security in real-time.

 

Money laundering

The process of disguising money obtained from criminal activity.

 

Money Laundering Reporting Officer (MLRO)

An official of a financial firm who is responsible for monitoring and reporting suspicions related to money laundering. Employees of the firm must report such suspicions to the MLRO.

 

MQP

Firm Quoted MQP

 

MQP1

MQP No Automatic Execution

 

MQP2

Mandatory Quote Period with Order Deletion at Start

 

MTN

Medium-term note (MTN). An unsecured note issued in a euro-currency with a maturity of 3 to 6 years.

 

Mutual fund

A collective investment scheme in the US that pools investors’ money to be invested in stocks, bonds and other securities.