The direct market access is an electronic facility. These facilities are basically supplied by the independent firms. These firms basically allow purchasing the side firms in order to get liquidity security. These side firms are the customers of the selling firms. These selling firms are the banks and the brokers that are playing the role of the market makers. The firm that buys would still utilize the infrastructure of the selling firms. However they have full control over the execution of the trade. Direct market access allows the trade at low cost. As the processes are totally electronic so the chances of errors gets negligible. These executions are fast so there is chance for the traders to utilize this opportunity and take advantage of it.
The direct market trading basically enables the traders to trade without the hindrance of any broker. These DMA are used by the investors to enhance the control over the trades. This is just to remove the middle man. However, the middleman is not been eliminated completely as there services are still needed. The very first benefit that DMA provides is that it allows trading within the spread. Generally when the price is quoted by the broker and is placed as 420-425. This means that one can purchase it at 425 but can sell it at 420. This difference of 5 points is known as spread. These DMA help you to deal within these spread to ensure great profits
Advantages Of Direct Market Access
Following are some advantages of the direct market access:
1.Provides Better equality.
3.Prioritized the orders in respect to the price and trades.
4.Allows liquidity in central market.
5.Allows you to quote your own price.
7.You can also actively participate in auctions.
8.It also allows the traders to take active part in the post and per market auctions.
These DMA are very beneficial and are of great advantage. These DMA offers transparency in the market. All the trades in the market become quite visible and clear. This means that you can get a straight deal without the involvement of any middleman.
You will be highly benefited by the DMA as they will allow you to view each and every order. This allows you to have a look on every selling and purchasing of the orders. With the help of these DMA you will be able to make a well informed and proper decision.
This was all about the Direct Market Access. Hope that this article would have provided you with all the essentials you needed about the Direct Market Access.