I have a lot of experience with the Bitcoin industry, but little experience with the Stock Market. In the bitcoin industry, when you want to buy/sell, you have to put out a market order on whatever exchange you are currently using, but usually the market order isn't always at the current "market price".

For instance, when you sell Bitcoin, you'll usually sell into someone's current buy order, for a $1-2 less than current market price. Similarly, when you want to buy, you set a "buy price", and absorb any sell orders at that price point.

Are Stock markets similar to this? Is there a standards bureau behind the market that all stocks are bought/sold through to make sure that all stocks are bought/sold at the current market price? Are you always able to sell a stock even if there is no buyer? Are you allowed to sell a stock for half of it's market price if you really wanted to?

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    By definition, the price this share gets sold at becomes the market price at that moment. This does not imply the next share will sell for the same price. – keshlam Jun 21 '16 at 20:50
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    "Are you always able to sell a stock even if there is no buyer?" No. Where would the money you receive come from? If there is no buyer, there is no sale. – elmer007 Jun 21 '16 at 22:02
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    @elmer007 From a market maker -- someone who gets preferential treatment from exchanges in exchange for buying and selling when there is no buyer or seller. – David Schwartz Jun 21 '16 at 22:18
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    @DavidSchwartz In that case the market maker is a buyer. If there is no buyer at all, then there is no sale. – user32479 Jun 22 '16 at 1:20
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    @DavidSchwartz Then the specialist is the buyer for the transaction, even if their role is only to sell it again later. You cannot sell something if no one buys it. – elmer007 Jun 22 '16 at 12:04

In general stock markets are very similar to that, however, you can also put in limit orders to say that you will only buy or sell at a given price. These sit in the market for a specified length of time and will be executed when an order arrives that matches the price (or better). Traders who set limit orders are called liquidity (or price) makers as they provide liquidity (i.e. volume to be traded) to be filled later.

If there is no counterparty (i.e. buyer to your seller) in the market, a market maker; a large bank or brokerage who is licensed and regulated to do so, will fill your order at some price. That price is based on how much volume (i.e. trading) there is in that stock on average. This is called average daily volume (ADV) and is calculated over varying periods of time; we use ADV30 which is the 30 day average.

You can always sell stocks for whatever price you like privately but a market order does not allow you to set your price (you are a price taker) therefore that kind of order will always fill at a market price. As mentioned above limit orders will not fill until the price is hit but will stay on book as long as they aren't filled, expired or cancelled.


As others have noted, your definition of "market price" is a bit loose. Really whatever price you get becomes the current market price. What you usually get quoted are the current best bid and ask with the last transaction price. For stocks that don't trade much, the last transaction price may not be representative of the current market value.

Your question included regulation ("standards bureau"), and I don't think the current answers are addressing that. In the US, the Securities and Exchange Commission (SEC) provides some regulation regarding execution price. It goes by the designation Regulation NMS, and, very roughly, it says that each transaction has to take the best available price at the time that it is executed. There are some subtleties, but that's the gist of it.

No regulation ensures that there will be a counterparty to any transaction that you want to make. It could happen, for example, that you have shares of some company that you're never able to sell because no one wants them. (BitCoin is the same in this regard. There is a currently a market for BitCoin, but there's no regulation that ensures there will be a market for it tomorrow.)

Outside of the US, I don't know what regulation, if any, exists.


Many of the Bitcoin exchanges mimic stock exchanges, though they're much more rudimentary offering only simple buy/sell/cancel orders. It's fairly normal for retail stock brokerage accounts to allow other sorts of more complex orders, where once a certain criteria is met, (the price falls below some $ threshold, or has a movement greater than some %) then your order is executed.

The space between the current buy order and the current sell order is the bid/ask spread, it's not really about timing. Person X will buy at $100, person Y will sell at $102. If both had a price set at $101, they would just transact. Both parties think they can do a little bit better than the current offer. The width of the bid/ask spread is not universal by any means. The current highest buy order and the current lowest sell order, are both the current price. The current quoted market price is generally the price of the last transaction, whether it's buy or sell.


For any large company, there's a lot of activity, and if you sell at "market" your buy or sell will execute in seconds within a penny or two of the real-time "market" price. I often sell at "limit" a few cents above market, and those sell within 20 minutes usually.

For much smaller companies, obviously you are beholden to a buyer also wanting that stock, but those are not on major exchanges.

You never see whose buy order you're selling into, that all happens behind the curtain so to speak.

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