central limit order book


Central Limit Order Book

A proposed database for all limit orders received by specialists and market makers throughout the United States. Such a system would allow limit orders to be fulfilled immediately or later, depending on the nature of the order, on any American exchange. The SEC proposed the establishment of CLOB, but it never occurred because most exchanges believe that such as a database would cause them to lose trading volume.

central limit order book (CLOB)

A central system that contains securities limit orders received from specialists and market makers. Such a system consolidates limit orders in a central location and bridges the gap in establishing a national market system. A hard CLOB executes orders immediately; a soft CLOB provides data to facilitate trading but does not include automatic executions. Establishment of a CLOB has generally been opposed by securities exchanges because they would stand to lose significant volume to such a system.