Chapter 04 · Section 4.1

Order vs. Quote

Dealers are generally said to "quote" a price for the options they are ready to buy or to sell. What is the difference between an order and a quote?

a) A quote is given by a dealer and is the counterpart to an order given by a customer.
• b) A quote cannot be withdrawn, whereas an order can be withdrawn.
  No. Somebody who makes a quote can always withdraw it as long as nobody has shown interest in it. An order, as long as it has not been executed, may also be withdrawn.
  c) A quote is entered by someone who buys/sells himself and for his own account, an order is executed by a broker on behalf of a customer.