Market Makers – SIX Swiss Exchange Structured Products

Market makers play an important role in providing liquidity to the market and helping to fix the price of structured products on the SIX Swiss Exchange.

Some of the key advantages of having market makers in this context include:

1. Improved liquidity: Market makers are typically large financial institutions or firms that are willing to buy and sell structured products at any time, regardless of the current market conditions. This helps to ensure that there is always a buyer or seller available for a particular product, which improves liquidity and makes it easier for investors to trade in and out of positions.
2. Price stability: Market makers help to fix the price of structured products by providing buy and sell quotes to other market participants. This helps to ensure that prices remain stable, even during times of market volatility or uncertainty.
3. Risk management: Market makers take on the risk of holding a large inventory of structured products, which helps to reduce the risk for other market participants. This is especially important for complex products such as structured notes, which can be difficult to value and trade.
4. Increased market efficiency: The presence of market makers helps to improve the efficiency of the market by providing a mechanism for price discovery and reducing the bid-ask spread. This makes it easier for investors to buy and sell structured products at a fair price, which in turn encourages more participation in the market.
5. Access to information: Market makers are typically well-connected and have access to a wide range of market information and research. This enables them to make informed trading decisions, which can benefit other market participants as well.
6. Market Integrity: With market maker active and providing liquidity, it makes it harder for malicious participants to manipulate the market.
7. Cost savings: Market makers can also help to reduce transaction costs for investors by providing liquidity at competitive prices. This can make it more affordable for retail investors to participate in the market for structured products.
8. Greater accessibility: Market makers help to democratize access to complex financial products. By making it easier for small investors to buy and sell structured products, market makers can help to increase the overall level of participation in the market and improve financial inclusion.

In conclusion, market makers are an important part of the financial market ecosystem, playing a crucial role in providing liquidity, stabilizing prices and managing risk.

They help to make the market for structured products more efficient and accessible, which benefits all participants, ultimately strengthen the overall market integrity.