We are independent & ad-supported. We may earn a commission for purchases made through our links.
Advertiser Disclosure
Our website is an independent, advertising-supported platform. We provide our content free of charge to our readers, and to keep it that way, we rely on revenue generated through advertisements and affiliate partnerships. This means that when you click on certain links on our site and make a purchase, we may earn a commission. Learn more.
How We Make Money
We sustain our operations through affiliate commissions and advertising. If you click on an affiliate link and make a purchase, we may receive a commission from the merchant at no additional cost to you. We also display advertisements on our website, which help generate revenue to support our work and keep our content free for readers. Our editorial team operates independently of our advertising and affiliate partnerships to ensure that our content remains unbiased and focused on providing you with the best information and recommendations based on thorough research and honest evaluations. To remain transparent, we’ve provided a list of our current affiliate partners here.

In Finance, what is a Real Market?

Malcolm Tatum
By
Updated May 16, 2024
Our promise to you
SmartCapitalMind is dedicated to creating trustworthy, high-quality content that always prioritizes transparency, integrity, and inclusivity above all else. Our ensure that our content creation and review process includes rigorous fact-checking, evidence-based, and continual updates to ensure accuracy and reliability.

Our Promise to you

Founded in 2002, our company has been a trusted resource for readers seeking informative and engaging content. Our dedication to quality remains unwavering—and will never change. We follow a strict editorial policy, ensuring that our content is authored by highly qualified professionals and edited by subject matter experts. This guarantees that everything we publish is objective, accurate, and trustworthy.

Over the years, we've refined our approach to cover a wide range of topics, providing readers with reliable and practical advice to enhance their knowledge and skills. That's why millions of readers turn to us each year. Join us in celebrating the joy of learning, guided by standards you can trust.

Editorial Standards

At SmartCapitalMind, we are committed to creating content that you can trust. Our editorial process is designed to ensure that every piece of content we publish is accurate, reliable, and informative.

Our team of experienced writers and editors follows a strict set of guidelines to ensure the highest quality content. We conduct thorough research, fact-check all information, and rely on credible sources to back up our claims. Our content is reviewed by subject-matter experts to ensure accuracy and clarity.

We believe in transparency and maintain editorial independence from our advertisers. Our team does not receive direct compensation from advertisers, allowing us to create unbiased content that prioritizes your interests.

The real market is the range that exists between the price that is asked for a product, and the amount that the consumer is willing to pay. Identifying the range of this market does not necessarily involve identifying the fundamental value of the product, or even the retail price that the product demands in other markets. Both buyers and sellers seek to identify the scope of the real market as they attempt to create a transaction that is mutually beneficial.

For the seller, understanding the current real market can increase the chances of making a sale. Setting the asking price often involves considering the current level of demand for the product, as well as looking at the prices of competitor goods that are similar in nature and readily available to the consumer. If the goal is to maintain current business while also earning business away from competitors, the seller will set the asking price at a level that is sure to attract attention and highly likely to motivate consumers to buy.

Buyers also seek to determine the scope of a real market, as it relates to some product that they wish to acquire. Here, the focus is on determining the level of interest in the product, and how it would benefit the buyer. From there, the buyer looks at the available range of competitive products, compares them for value and quality, and arrives at a price he or she is willing to pay in order to own the product. Under the best of circumstances, the amount the buyer is willing to pay is in line with the price desired by the seller, allowing both parties to gain from the transaction.

The concept of a real market is also common to investment activity. Here, a dealer will look closely at both the bid and ask quotes associated with a given transaction. Ideally, the dealer can match the bid price of a potential buyer with the ask price of a seller, making it possible to broker the deal, allow both parties to be happy with the terms of the transaction, and collect fees for the brokered deal.

Another application of a real market can involve the creation of an investment strategy that calls for buying shares of a given security when it reaches a certain price, and then selling those shares at a specific higher price. With this arrangement, the investor provides the dealer with instructions to execute each segment of the order when and as those bid and ask prices become viable. A strategy of this type can allow the investor to earn a significant amount of return, provided he or she is able to hold the asset for as long as necessary to achieve the desired result.

SmartCapitalMind is dedicated to providing accurate and trustworthy information. We carefully select reputable sources and employ a rigorous fact-checking process to maintain the highest standards. To learn more about our commitment to accuracy, read our editorial process.
Malcolm Tatum
By Malcolm Tatum
Malcolm Tatum, a former teleconferencing industry professional, followed his passion for trivia, research, and writing to become a full-time freelance writer. He has contributed articles to a variety of print and online publications, including SmartCapitalMind, and his work has also been featured in poetry collections, devotional anthologies, and newspapers. When not writing, Malcolm enjoys collecting vinyl records, following minor league baseball, and cycling.
Discussion Comments
Malcolm Tatum
Malcolm Tatum
Malcolm Tatum, a former teleconferencing industry professional, followed his passion for trivia, research, and writing...
Learn more
SmartCapitalMind, in your inbox

Our latest articles, guides, and more, delivered daily.

SmartCapitalMind, in your inbox

Our latest articles, guides, and more, delivered daily.