They created market liquidity by matching the investor’s buy and sell orders through their brokers (who were not allowed to make markets), and by selling and buying securities, they held shares in their own books. A small-scale wholesaler or middleman in the retail goods trade can also be described using the term jobber.
Since they kept a lot less records back in the day, there is a lot less known about jobbers, but in the early 19th century it is known that London had a lot, hundreds in fact, of jobbing firms. Over the course of the 20th century, the number of jobbers decreased dramatically and by October 1986, they ceased to exist. This was the month when a major shift in the London stock exchange’s operations occurred, it was known as the Big Bang. Suddenly, London’s financial sector was deregulated, electronic trading was implemented, and the fixed commissions were replaced by negotiated commissions.
Neither other observers nor journalists retained a lot in the way of detailed accounting of a jobber’s work, only jobbers left a few records of their affairs. Histories of stockbroking firms, banks, and other concerns will and have been continuing to be the basis for any historical records that are related to jobbers. An archive of interviews with former jobbers have been compiled by the Centre for Metropolitan History, and it serves as a permanent record of the last half of the century for a distinctive part of the financial life of London.
As the range of the securities types broadened, during the course of the 19th century, the jobber system evolved into a recognizably modern form. In making continuous market in one of the leading types of these securities were beginning to be specialized in by at leas half of the members of the London stock Exchange. The difference between the jobbers or the market makers, and the brokers who used to deal with them on the behalf of the public was very clear-cut but it was essentially based on tradition and custom until 1909, when embodied in the London Stock Exchange rules was a single capacity. Along with many jobbing operations conducted by only one man, there were 600 jobbing firms in existence by 1914.
Since the scale of required jobbing capital increased dramatically due to the institutional investor supplanting the private one, the numbers given above steadily decaled. On the floor of the London stock Exchange there were only five major jobbing firms left the eve of the “big bang”, even though this decline in the numbers did not necessarily denote a decline in the marketability that was provided by the system.
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