What is ‘Fast Market’
A condition that will be officially declared by a stock market exchange when the financial markets are experiencing unusually high levels of volatility, combined with unusually heavy trading. Fast markets occur rarely, but when one does occur, brokers are not held to the same constraints as they are during a regular market.
Explaining ‘Fast Market’
Inexperienced investors are more likely to get burned in a fast market because of the unique problems that arise under extreme trading conditions. One problem is that quotes can become inaccurate when they can’t keep up with the pace of trading. Another problem is that brokers may not be able to fill orders when investors want or expect them to, so their securities may be bought and sold at undesirable price levels that don’t provide the return the investor anticipated.
Further Reading
- A dynamic limit order market with fast and slow traders – www.sciencedirect.com [PDF]
- Fast fashion: response to changes in the fashion industry – www.tandfonline.com [PDF]
- Equilibrium fast trading – www.sciencedirect.com [PDF]
- The recognition heuristic: a fast and frugal way to investment choice? – www.sciencedirect.com [PDF]
- The review process in economics: is it too fast? – www.jstor.org [PDF]
- Meeting the challenge of wastewater irrigation: economics, finance, business opportunities and methodological constraints – www.tandfonline.com [PDF]
- Hierarchical chain of consumer-based brand equity: Review from the fast food industry – clutejournals.com [PDF]
- Post-trade transparency on Nasdaq's national market system – www.sciencedirect.com [PDF]
