Definition of Locked Market

Locked market is a market condition that results from the bid and the offer for a security are equal.

Applying "Locked Market" to Securities Exams:

When market makers enter bids and offers for securities over the NASDAQ work station the bids and offers must adhere to certain requirements. A broker dealer may not enter a bid or offer for a security that would locked the market. The NASDAQ system prevents most orders that would lock the market from being entered.

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