What is the role of market makers on Wall Street?

Market makers play a crucial role in maintaining liquidity and market stability in financial markets by ensuring that there are enough buyers and sellers for securities to be traded smoothly. These firms or individuals are responsible for buying and selling securities at quoted prices, which allows investors to buy or sell assets without having to wait for a counterparty to be available.

Market makers also have the responsibility of setting bid-ask prices and maintaining spreads, which are the differences between the ask prices (what sellers are willing to sell a security for) and bid prices (what buyers are willing to pay for that security). By setting competitive spreads, market makers help to ensure that there is enough interest in a security so that it can be easily bought and sold.

Some market makers also provide additional services, such as market research and analysis to help investors make informed trading decisions. They may also act as dealers in exchange-traded funds (ETFs) or provide other specialized services to clients.

It's worth noting that market makers are not just found on Wall Street. They operate in financial markets around the world, providing liquidity and stability to markets large and small.