What Market Data Means
For any financial instrument the market data refers to the price and trade related data. This data is reported by a trading venue such as stock exchange. Through the market data, traders and investors are able to know the latest prices. Historical trends of the instruments and the latest market trends are also known. The instruments refers to the equities, fixed income products and currencies. Market data can also be explained in other ways. The electronic streaming of prices and volumes is what it is.
The trading venues are sources of the majority of market data. Issues are the sources of the reference data which is collected by the market data vendors. A foundation for performing various transactions for trader and vendors is provided by the market data. Through this they are also able to manage various financial assets. That information which is gathered and distributed through the various indexes is included in the market data.
Various assets are used in reporting market data. It is also reported on other financial instruments by the trading companies and exchanges. The traders can tell the worth of various assets through this data. They can also lay good strategies on how to make a profit. The delivery of real time market data is very important. It enables the traders to make timely and informed decisions. The historical information availed is key in the planning of future trades.
For a particular instrument the market data includes different things. It includes the identifier of the instrument and where it was traded. Included in the identifier are the ticker symbol and the exchange codes. The information included in the data are the volume traded, bid and offer sizes and the static data. Specialization in collection cleaning, collating and distributing market data is done by some people. Financial data vendors is what they are called. This is the most common way on how the traders can access the market data.
Classification of market data is in two main categories. The category one provides the investors with basic information trading. What is included in the information is the lowest ask and highest bid prices. This information is required in telling the best bid offer data. Information on the most attractive security in the market is offered by the other category. It provides the investors with information to keep track of the moving securities. Volume based trading systems and the information on the trading systems is provided.
Information of market data is used in the real time. The buying and selling spot decisions are made therefore. The information is also used historical so as to project pricing trends. Calculation of the market risk on the portfolio used the historical information that is provided. Holding of the investments may however be done by the individuals as well as the institutional investments.