General Rules
Rules governing orders and trades applicable to the Stock Market also apply to the securities in which market making is executed unless otherwise specified.

In the case of securities to which market making is applied, the member assigned as the market maker provides quotations on the buy and sell sides continuously. The buy and sell sides of the quotation are entered in the system concurrently.

Rules governing price and time priority applicable to the Stock Market also apply to the market maker member. The market maker is not given any priority except the “right to enter quotation prior to continuous auction" that shall be vested prior to the start of the continuous auction.

No quotation is provided for the opening session.

The initial quotation given by the market maker is valid throughout the session. In this process, quotation prices may be decreased or increased, quantities may be reduced or increased using the change function within the framework of rules, but the quotation cannot be divided or cancelled.

Quotation orders are always included in the pending limit order book in accordance with the price and time priority rule. Quotations are valid for the session in which they are provided. When the quantity for the given quotation is traded and consumed, the quantity for the quotation is renewed using the change function.When the session is completed, the unexecuted part of the quotation is automatically cancelled by the system.

A normal order can be matched with a quotation in conformity with the priority rules or with an order that belongs to the member itself or to another member provided that quotation limits are not breached.

What is Continuous Auction with Market Maker Method?

Continuous Auction with Market Maker Method: 

This is a trading method where a member assigned as the market maker provides bilateral continuous quotations (price and quantity) for securities traded via the continuous auction method using an account or accounts which have been defined for such purposes, and thereby helps to determine a price range in which transactions can be executed with such security, and create liquidity. This method is applied to securities that are traded on the Corporate Products Market. 

Market Maker Member and its Function

Market maker is a member satisfying the basic criteria for being a market maker whose application to act as a market maker for a security has been accepted by the Executive Council of İMKB. Market maker starts acting as such by signing the “İMKB Stock Market Market-Maker Letter of Undertaking".

The task expected of the market maker may be summarized as preventing excessive price movements that may occur in a security which lacks sufficient depth for continuous auction and has a low publicly offered market price due to short-lasting supply and/ordemand volatilities, providing liquidity continually for the market, thereby contributing to the development of a continuous auction environment effectively. 

Quotation

Quotation is the statement of a price and quantity conveyed by the market maker member in the form of  bid and ask offer, determining the price range in which transactions can be performed according to the values of the security at the time of the session during which it is conveyed. 

 
 
Markets and Securities to Which Continuous Auction with Market Maker Method is Applied

The continuous auction with market maker method is applied to the securities listed on the Corporate Products Market (CPM).  Exchange traded funds, intermediary institution warrants and stocks of mutual funds with a publicly offered market capitalization value below 10 million TL are required to be traded via the continuous auction with market maker method.

Benefits  of the Continuous Auction with Market Maker Method for the Market

As known, the basic operation principle of the Stock Market of İMKB is the continuous auction method. This method is supported by the single price method at the opening.   While it is used as the most effective method in the developed securities markets of the world, the continuous auction method is supported by market makers in such securities that are weak in terms of liquidity and the publicly-held market capitalization value.  In other words, the continuous auction with market maker method constitutes a mixed structure which, as a trading method, allows to convert quotations of the market maker as well as the other orders sent to the public order book to a transaction by matching them according to price and time priority. 

With this method, it is aimed that price stability is achieved for the related security with the bid and ask quotations given by the market maker, and consequentially the excessive price volatility that occurs outside the price movements created by the market are prevented. In this way, securities that are traded through a market maker are protected from artificial price movements which raise concerns of the investors.  The quotations of the market maker will remain in the system throughout the session to provide substantial assurance for the liquidity of the security. 

As a result, the continuous auction with market maker method constitutes a safe barrier against excessive volatility and potential manipulative transactions. The market maker member is granted important rights to keep the security to which it is assigned under control, and therefore, it becomes difficult to carry out transactions that manipulate the price of the security without the desire of the market maker member in such securities which are traded via the continuous auction with market maker method.