Markups and Markdowns

{
  "id": "MLC-T-FIN-000244",
  "term": "Markups and Markdowns",
  "field": "Finance and investing",
  "definition": "When a broker-dealer buys from or sells to you directly securities it holds in its own inventory, the broker-dealer acts as a principal in the transaction. When acting as a principal, the broker-dealer generally will be compensated by selling the security to you at a price that is higher than the market price (the difference is called a markup), or by buying the security from you at a price that is lower than the market price (the difference is called a markdown).",
  "references": [
    "SEC Investor.gov Glossary"
  ],
  "url": "https://mlchart.com/terminology/finance/markups-and-markdowns/"
}